FULL YEAR RESULTS - ANZ · Results Presentation & Investor Discussion Pack. Index Full Year Result...

12FULL YEAR

RESULTSAUSTRALIA AND NEW ZEALAND

BANKING GROUP LIMITED

25 October 2012

Results Presentation &

Investor Discussion Pack

Index

Full Year Result Overview

CEO Presentation 3

CFO Presentation 11

Additional Financial Information

Adjustments between statutory profit and underlying profit 23

Net Interest Margin 24

Balance Sheet 33

Treasury 37

Risk Management 48

Divisional Performance

Australia Division 70

International and Institutional Banking 98

New Zealand Businesses 121

Global Wealth and Private Banking 134

2

12FULL YEAR



25 October 2012

Mike Smith

Chief Executive Officer

Overview of financial performance

4

2012

$M %

Underlying Profit1, 2, 3 6,011 +6%

Operating Income 17,579 +5%

Expenses 8,022 +4%

Provisions 1,246 +3%

Statutory Net Profit After Tax 5,661 +6%

EPS (cents) 225.3 +3%

Dividend per Share (cents) 145 +4%

Net Interest Margin 2.31% -11bps

Customer deposits 327,876 +10%

Net loans and advances4 427,823 +8%

All figures other than Statutory Net Profit after Tax and Dividend are presented on an underlying basis 1. The statutory profit is adjusted to exclude certain non-core items to arrive at underlying profit2. A reconciliation between statutory profit to underlying profit has been provided on page 23 of this presentation3. Refer to pages 75 to 84 of the ANZ Consolidated Financial Report Dividend Announcement and Appendix 4E for an analysis of thereconciliation of statutory profit to underlying profit4. Including acceptances

21

Australia Division

5

Underlying profit growth FY12 v FY11

Australia Division 4%

Traditional Banking Market Share1Underlying Net Profit after Tax

2,3902,492

1,1871,305

FY11 FY12 1H12 2H12

$m

Cost to Income Ratio (%)

10

11

12

13

14

15

16

Jul-10 Jan-11 Jul-11 Jan-12 Jul-12

2121

ANZ Peer 1 Peer 2 Peer 3

22

23

21

Aug-12

1. Source: Roy Morgan Research: Aust Pop‟n aged 14+, rolling 12 months, Trad Banking Consumer Market (Deposits, Cards & Loans), Peers: CBA (excl Bankwest), NAB, Westpac (excl Bank of Melbourne & St George)

41%40%

42%

39%

1380

1430

1480

1H11 2H11 1H12 2H12

35%

37%

39%

41%

43%

Operating Expenses (RHS) CTI (LHS)

International and Institutional Banking (IIB) Division

6

Underlying profit growth (AUDm) FY12 v FY11

IIB Division 3%

Income Growth FY12 v FY11Net profit after Tax

11%

25%

14%

17%

Cash Management

Trade & Supply Chain

Global Markets

Foreign Exchange

1,333 1,557 1,464

714

744 908

FY10 FY11 FY12

Institutional Australia / New Zealand APEA

1. Includes Relationship & Infrastructure Australia / New Zealand

1

2,047

2,301 2,372

$m

New Zealand Businesses

7

Underlying profit growth (NZDm) FY12 v FY11

New Zealand Businesses 11%

Cost to Income Ratio

44.9% 44.9%

44.1%43.8%

480

500

520

540

560

580

600

620

640

660

40.5%

41.0%

41.5%

42.0%

42.5%

43.0%

43.5%

44.0%

44.5%

45.0%

1H11 2H11 1H12 2H12

Operating Expenses (RHS) CTI (LHS)

Underlying profit

863

957

473 484

FY11 FY12 1H12 2H12

NZDm NZDm

Global Wealth and Private Banking Division

8

Underlying profit growth FY12 v FY11

Global Wealth and Private Banking Division -1%

Insurance annual in-force premiumsUnderlying profit

457 451

206

245

FY11 FY12 1H12 2H12

$m

Cost to income ratio

1,758

1,722

1,822

2H11 1H12 2H12

$m

57.4%58.0%

59.8%

56.3%

FY11 FY12 1H12 2H12

Credit Quality

9

0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

0.90%

1.00%

-250

0

250

500

750

1,000

1,250

1,500

1,750

2,000

1H07 2H07 1H08 2H08 1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12

% Avg. Net Advances$m Collective Provision Charge (LHS)

Individual Provision Charge (LHS)

Total Provision Charge as % Avg. Net Advances (RHS)

Provision Charge Trends

Progressing well against our strategic objectives

10

• % IIB revenue derived outside AUS/NZ 43%

• % IIB deposits derived outside AUS/NZ 54%

• APEA revenues

• Cross border revenues

• Product revenue

Trade & Supply Chain

FX

Cash Management

• Customer segment revenue

Natural Resources

FIG

Agriculture

Infrastructure

• Jaws + HOH / + YOY

• Cost to income ↓HOH / ↓YOY

• OPEX to average assets ↓HOH / ↓YOY

• Lowering unit costs

Operational cost growth flat HOH despite all divisions growing transaction volumes and digesting past investment in property and technology

• Natural drags on ROE3 being offset with efficiency actions

Divested Visa shareholding

Divested Origin mortgage business

Restructure of Wealth balance sheet

• Removing discount on DRP for the final dividend

Strengthen Domestic Franchise Connectivity / Revenue Diversification

Operational Leverage Capital and Funding Efficiency

1. 12 months to August 20122. Refers to revenues generated by Commercial clients and booked in other divisions

3. Including additional regulatory requirements and a lower rate environment

• Market share

AUS Mortgages ↑20 bps YOY1

AUS Household Deposits ↑20 bps YOY1

NZ Mortgages ↑41 bps YOY1

NZ Household Deposits ↑5 bps YOY1

• Cost to income

Australia Division ↓HOH / ↓YOY

NZ Division ↓HOH / ↓YOY

• Australia Commercial clients

Trade finance revenue2 ↑20% YOY

Global markets revenue2 ↑40% YOY

• Growing use of digital and online channels

goMoney registered users Over 780k

↑14%

↑16%

↑25%

↑17%

↑11%

↑25%

↑15%

↓8%

↓8%

12FULL YEAR



25 October 2012

Shayne Elliott

Chief Financial Officer

5,652

6,011

613

154

304 35

69

FY11

Underlying

Profit

NII OOI Expenses Provisions Tax & OEI FY12

Underlying

Profit

Performance FY12 v FY11 ($m)

2012 Full year financial performance

12

1H12Underlying

ProfitNII OOI Expenses Provisions Tax & OEI

2H12 Underlying

Profit

2,973 143 28 18 (116) (8) 3,038

Up 2% Up 1% Flat Up 21% Up 2%

Performance 2H12 v 1H12 ($m)

Up 5% Up 3% Up 4% Up 3% Up 3%

Up 6%

ROE 16.2% ROE 15.6%

Super Regional Strategy – 5 Core Themes

13

Strengthen our position in Australia and New Zealand1

Capture faster growing regional flows in trade, capital and wealth2

Diversify revenue streams by product, geography and customer3

Leverage global hubs and shared platforms 4

Drive capital efficiency and superior returns for shareholders5

Strengthening our position in Australia & New Zealand

14

Australia New Zealand

12%

9%

7%

9%

Retail Commercial

Deposit & Lending Growth

FY12 v FY11

Deposits Lending

9%

13%

1%

12%

Retail Small Business Banking

Deposit & Lending Growth

FY12 v FY11

Deposits Lending

35.0%

40.0%

45.0%

1H11 2H11 1H12 2H12


35.0%

40.0%

45.0%

1H11 2H11 1H12 2H12


0

200

400

600

800

1,000

1,200

1H10 2H10 1H11 2H11 1H12 2H12

$m Sales Trading Balance Sheet

10%

17%

11%

25%

Global

Markets

Sales

Foreign

Exchange

Cash

Management

Trade &

Supply Chain

-8%

15%

25%

46%

Agriculture Financial

Institutions

Natural

Resources

Commercial

Asia

Capturing regional flows and diversifying income

15

Income Growth FY12 v FY11Global Markets Income

953

864

988

701

1,022

909

Productivity focus is delivering results

16

Cost to Income Ratio (%) Operating Expense Growth (%)

15%

9%11%

6%4%

2%

Group Australia

FY10 FY11 FY12

17%

2%

20%

-2%

6%

0%

IIB New Zealand (NZD)

FY10 FY11 FY12

35%

40%

45%

50%

1H11 2H11 1H12 2H12

Group

Australia Division

International & Institutional Banking Division


Effective capital management critical in a lower growth environment

17

Common Equity Tier 1 Ratio

7.3% 7.5% 7.8% 8.0%

Mar 11 Sep 11 Mar 12 Sep 12

APRA Basel 3 Internationally Harmonised Basel 3

9.3% 9.5% 9.8% 10.0%

21

8

11

Sep 12

$11bn of shareholders‟ equity used to strengthen capital ratios

Business Growth

Capital Strengthening

Shareholders‟ Equity

September 2007

$40b

Credit quality tracking in line with expectations

18

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Mar 10 Sep 10 Mar 11 Sep 11 Mar 12 Sep 12

$m> $100m $10-$99m < $10m

Gross Impaired Assets by Size of Exposure

6,561 6,5616,221

5,5815,343 5,196

862

597

(44)

(198)(29)

6

1H12 Australia IIB NZ Other 2H12

Management Overlay Balance Movement 2H12 v 1H12

2012 Operating Income Mix

19

Customer RevenueDivisional Revenue

65%20%

15%

Financing & Capital Management

Risk Management

Payments & Cash

Management

40% 37%

12%8%

2%

Australia

New Zealand

International & Institutional Banking

Global Wealth & Private Banking

Group Centre

Net Interest Margin

Net Interest Margin trends

20

Group Ex-Markets Australia Division

IIB Ex-MarketsNew Zealand

Businesses (NZD)

Net Interest Income 2H12 v 1H12

-2.5%

1.8%

4.9% 4.2%

Volume Margin Volume Margin

-10.3%

-2.5%

7.4%2.9%


Down 7bps Up 4 bps

Down 33bps Down 7 bps

2H11 1H12 2H12

1.50%

2.00%

2.50%

3.00%

3.50%

ANZ Group ex-markets

Australia Division

NZ Businesses

IIB Division ex-Markets

Outlook - Continuing to execute our super regional strategy

21

Dividend

102126 140 145

64.1% 64.1% 65.0% 65.3%

FY09 FY10 FY11 FY12

Full Year Dividend Dividend Payout Ratio (RHS)

Operating Expense Growth

Return on Equity

19.6%15.1% 13.3%

15.5% 16.2% 15.6%

FY07 FY08 FY09 FY10 FY11 FY12

Income Growth

6% 7%

3%

16%

Australia / New Zealand APEA

FY11 FY12

15%

11%

4%

FY10 FY11 FY12

12FULL YEAR



25 October 2012


Additional Financial Information

Adjustments between statutory profit and underlying profit

23

2H12 FY12

$M $M

Statutory profit 2,742 5,661

Adjustments between statutory profit and underlying profit

Gain on sale of Visa shares (224) (224)

New Zealand Simplification programme 59 105

Acquisition related adjustments 13 41

Treasury shares adjustment 26 96

Economic hedging - fair value (gains)/losses 207 229

Revenue and net investment hedges (gains)/losses 10 (53)

Capitalised software impairment 220 220

NZ managed funds impacts - 1

Non continuing businesses (15) (65)

Total adjustments between statutory profit and underlying profit1 296 350

Underlying profit 3,038 6,011

1. Refer to pages 75 to 84 of the ANZ Consolidated Financial Report Dividend Announcement and Appendix 4E for an analysis of the reconciliation of statutory profit to underlying profit

24

Some small variances to the detailed NIM pages exist as a result of rounding

Net Interest Margin (NIM) movement summary

Basis points (bps) Group Divisions Regions

Australia Division NZ Businesses IIB Division Australia NZ

HOH YOY HOH YOY HOH YOY HOH YOY HOH YOY HOH YOY

Starting NIM 235 242 245 259 266 252 195 209 251 259 247 235

Funding & Asset Mix -2 1 -1 -2 3 7 -8 -11 -3 -1 2 6

Funding Costs -2 -8 5 -3 -2 -15 -11 -7 -2 -6 -1 -10

Deposits -11 -10 -16 -14 -9 1 -4 -7 -12 -11 -9 2

Assets 9 6 18 10 4 13 -7 -15 13 7 3 12

Other -1 2 -2 -3 -3 4 -3 0 -1 -1 -3 2

Movement excl. Global

Markets -7 -9 4 -12 -7 10 -33 -40 -5 -12 -8 12

Markets 0 -2 0 0 0 0 14 16 2 2 0 -4

Total Movement -7 -11 4 -12 -7 10 -19 -24 -3 -10 -8 8

Ending NIM 228 231 249 247 259 262 176 185 248 249 239 243

Net Interest Margin

NIM – Divisional Trends

25

Group Ex-Markets Australia Division

IIB Ex-MarketsNew Zealand

Businesses (NZD)

Net Interest Income 2H12 v 1H12

-2.5%

1.8%

4.9% 4.2%


-10.3%

-2.5%

7.4%2.9%


Down 7 bps Up 4 bps

Down 33 bps Down 7 bps

2H11 1H12 2H12

1.50%

2.00%

2.50%

3.00%

3.50%

ANZ Group ex-markets

Australia Division

NZ Businesses

IIB Division ex-Markets

26

Key drivers of movement

Funding & Asset Mix

Relative increase in Transaction Banking and lower growth in cards

Funding Costs Lower returns on invested capital, wholesale funding costs stabilised in the half

DepositsStrong competition for deposits in Australia and NZ and an increase in proportion of term deposits, particularly in Australia and IIB

AssetsAsset repricing benefits in Australia and New Zealand, partially offset by increased pricing competition in Global Loans

235

2282

2

11

9

1 0

1H12 Funding &Asset Mix

Funding Costs Deposits Assets Other Markets 2H12

bps

NIM movement 2H12 v 1H12

Including markets down 7 bps

NIM – Group

Ex-markets down 7 bps

27

Key drivers of movement

Funding & Asset Mix

Reduced reliance on wholesale funding offset by growth in Transaction Banking and lower growth in Cards

Funding Costs Lower returns on invested capital and higher wholesale funding costs

Deposits Effects of strong competition for deposits primarily in Australia

AssetsAsset repricing benefits in Australia and New Zealand, partially offset by increased pricing competition in Global Loans

242

231

1

8

10

62

2

FY11 Funding &Asset Mix

Funding Costs Deposits Assets Other Markets FY12

bps

NIM movement FY12 v FY11


NIM – Group


245249

1

5

16

18

2

1H12 Funding & Asset Mix

Funding Costs Deposits Assets Other 2H12

bps

259

2472

3

14

10

3

FY11 Funding & Asset Mix

Funding Costs Deposits Assets Other FY12

bps

28



Down 12 bps

Up 4 bps

NIM – Australia Division

266

259

3

2

9

4

3


Funding Costs Deposits Assets Other 2H12

bps

252

2627

15

1

134


Funding Costs Deposits Assets Other FY12

bps

29



Up 10 bps

Down 7 bps

NIM – New Zealand Division

NIM – International & Institutional Banking Division

30


209

18511 7

7

15

0

16



bps


195

1768

11 47 3

14



bps





NIM – Australia Geography

31


259

2491

6

11

7

1

2



bps


251 248

3 2

12

13

1 2



bps





NIM – New Zealand Geography

32


235

2436

10

2

12 2

4



bps


247

239

2

1

9

3

3 0

1H12 Funding &

Asset MixFunding Costs Deposits Assets Other Markets 2H12

bps

Including markets up 8 bps

Ex-markets up 12 bps



Balance Sheet – Customer Lending & Deposits

33

0

50

100

150

200

250

300

350

400

450

Sep 08 Sep 09 Sep 10 Sep 11 Sep 12

$b

Australia APEA New Zealand Group LTD Ratio (RHS)

167%

130%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

0

50

100

150

200

250

300

350

400

450


Loan / Deposit Ratio

$b

Net Loans & Advances (incl. Acceptances)

Customer Deposits

Balance Sheet – Composition by Geography

34

Customer Lending1 by Geography Customer Deposits by Geography

1. Customer lending represents Net Loans & Advances including acceptances

30%

13%

17%

5% 19%

8%

5%

3%60%

24%

16%Australia

APEA

NewZealand

Australia Retail

Australia Commercial

Australia Institutional

APEA

Retail & Wealth

APEA Commercial

& Institutional

New ZealandRetail & Wealth

New ZealandCommercial

New ZealandInstitutional

71%

11%

18%

43%

3%

12%

14% 2%

8%

7%

10%

1%

Australia

NewZealand

Australia Retail Mortgages

Australia Other Retail



APEA Retail & Wealth

APEA Commercial & Institutional



New ZealandInstitutional

APEA

Balance Sheet – Composition by Division

35

57%

25%

17%

1%

Australia


New Zealand


Customer Lending1 by Division Customer Deposits by Division

43% 44%

12%1%

Australia


New Zealand



Customer Deposits by Segment

Balance Sheet – Composition by Segment

36

30%

5%

8%

13%

5%

17%

19%

3%

43%

18%39%

Retail & Wealth

Commercial

Institutional

Australia Retail & Wealth


AustraliaCommercial APEA

Institutional


New Zealand Institutional



46%

2%

7%

12% 10%

14%

8%

1%55%

22%

23%Retail & Wealth

Commercial

Institutional

AustraliaRetail & Wealth



APEA Institutional

New Zealand Commercial

AustraliaInstitutional

New Zealand Institutional


Customer Lending1 by Segment


12FULL YEAR



25 October 2012


Treasury

Increased Liquid AssetsStrong Capital Position

Balance Sheet strengthening has been a consistent focus

38

5.9%8.0% 8.8%

7.7%

10.1%10.8%

Sep 08 Sep 10 Sep 12

Basel 2 Tier 1 Ratio Basel 2 Common Equity Tier 1

7% 8% 8%

50% 57% 61%

14%16% 12%7%6% 5%

22% 13% 14%


Strengthened Funding Profile

38

75

115


Diversified Term Debt Portfolio

26% 28% 35%

23%33%

31%

41% 26% 21%

10% 13% 13%


Domestic North America Europe Asia

AUDb

Customer Funding

Shareholders equity & Hybrid debt

Short Term Wholesale Funding

Term Debt < 1 year Residual Maturity

Term Debt > 1 year Residual Maturity

ANZ is in a strong capital position

Capital levels are well positioned (CET1)

7.3% 7.5% 7.8% 8.0%

4.5%

9.3% 9.5%9.8% 10.0%

2.5%

Mar 11 Sep 11 Mar 12 Sep 12 Jan 16

APRA Basel 3 Internationally Harmonised Basel 3

39

Capital Management Agenda

• Capital strengthening phase is largely complete

• Discount applied to Dividend Reinvestment Plan removed for the 2012 Final Dividend

• Continuing focus on capital allocation and optimisation

21

40

8

11

Sep-07 Sep-12

Business Growth

Capital Strengthening

$11bn of shareholders‟ equity used to strengthen capital ratios

CET1 Minimum

Capital Conservation

Buffer

AUDb Basel 3 Minimum Capital

Requirement

10.03

7.47

2.03

(0.70)(0.27)

(0.76)

0.28

(0.03)

8.02

Sep-11 APRABasel 3

Underlying NPAT (1)

RWA Usage (2) Non RWA Business Usage

(4)

Dividends (net DRP)

Capital Initiatives and Divestments

(5)

Other (6) Sep-12 APRABasel 3

Sep-12 InternationallyHarmonised B3

Portfolio growth: 38bp decrease

Risk Migration (incl EL vs EP): 2bp increase

Portfolio data review: 5bp increase

Non credit RWA3: 39bp decrease

Up 55 bps

Solid organic capital generation underpins strong Basel 3 CET1 position

40

Capital Position (APRA Basel 3 Common Equity Tier 1)

1. Underlying earnings net of pref shares. 2. Includes impact of expected loss versus eligible provision shortfall 3. Includes Operational model risk (22bps).

4. Includes capital retention of deconsolidated entities, capitalised software (before write off) and other intangibles. 5. Includes external refinance of OnePathAustralia and sale of shares in VISA Inc. 6. Net FX, Non-Core NPAT items, net deferred tax assets and AFS reserve.

Reconciliation of ANZ‟s capital position under Basel 3

ANZ capital ratios: Basel 2 to Basel 3

1. Includes credit counterparty but excludes any Basel 3 liquidity changes.

CET1 Tier-1 Total Capital

Sep-12 APRA Basel 2 8.8% 10.8% 12.2%

Dividend not provided for (net of DRP) 0.5% 0.5% 0.5%

Investments in ADI and overseas equivalents -0.4% -0.4% 0.0%

Investments in ANZ insurance subs including OnePath -0.3% -0.3% 0.0%

Expected losses in excess of eligible provisions -0.2% -0.2% 0.0%

Other 0.0% -0.1% -0.1%

10% reduction of existing hybrid and Tier 2 securities 0.0% -0.2% -0.4%

Estimated increase in RWA1 -0.4% -0.4% -0.5%

Sep-12 APRA Basel 3 8.0% 9.7% 11.7%

10% allowance for investments in insurance subs and ADIs 0.7% 0.7% 0.7%

Up to 5% allowance for deferred tax asset 0.2% 0.2% 0.2%

Other capital items 0.2% 0.2% 0.2%

Mortgage 20% LGD floor and other measures 0.5% 0.6% 0.6%

IRRBB RWA (APRA Pillar 1 approach) 0.4% 0.4% 0.5%

Sep-12 Internationally Harmonised Basel 3 10.0% 11.8% 13.9%

41

(30.3)

(22.9)

9.3

(15.9)

0.4

28.3

31.1

Deposits

Loans

Term

Debt

Issuance &

Equity

Term

M

atu

rities

Short

Term

debt net of

Inte

r-B

ank

Liq

uid

s

Oth

er

7% 8% 8% 9% 8%

50%54% 57%

60% 61%

14%

15%16% 12% 12%7%

5%6% 6% 5%

22% 18%13% 13% 14%


Customer Funding

Shareholders equity & Hybrid debt

Well diversified funding profile with a low reliance on offshore short term wholesale debt

Strengthened Funding Profile

42

FY12 Lending growth fully funded by deposit growth

AUDb

Offshore

Commercial Paper only 2% of total funding

(USD13b)

Short Term Wholesale Funding

Term Debt < 1 year Residual Maturity

Term Debt > 1 year Residual Maturity

1

1. Excludes unfunded documentary credit acceptances

0bp

20bp

40bp

60bp

80bp

100bp

120bp

140bp

160bp

Sep-05

Sep-06

Sep-07

Sep-08

Sep-09

Sep-10

Sep-11

Sep-12

Sep-13

3m BBSW

Actual portfolio cost

Forecast portfolio cost based on current market levels

FY13 term funding well progressed, already one third complete

Consistent term wholesale funding requirement

Growth in term wholesale funding portfolio costs moderating

43

Indicative annual issuance volumes

0

5

10

15

20

25

30

FY08

FY09

FY10

FY11

FY12

FY13

FY13

FY14

FY15

FY16

FY17

FY18+

Senior Unsecured Government Guaranteed

Covered Bonds Subordinated

Issuance since 1-Oct-12

Issuance Maturities

AUDb

26% 28% 28%34% 35%

23%

30% 33%

35% 31%

41%30% 26%

18% 21%

10% 12% 13% 13% 13%


Domestic North America Europe Asia

32%41%

68%

35%

24%

FY08 FY12*

AUD/NZD

Foreign Currency - Senior Unsecured/Subordinated

Foreign Currency - Covered Bonds

Recent issuance has been well diversified supporting a sustainable wholesale debt portfolio

Term Debt OutstandingsTerm Debt Issuance

Weighted avg.tenor : 4.0 yrs

Weighted avg.tenor : 4.7 yrs

44*Excludes FY13 pre-funding

6.6yrs

3.9yrs

4.2yrs

Lower structural funding gap provides funding flexibility

45

Source: APRA (Aug 12) and latest bank published financial statements

AUDb

• Having the lowest wholesale funding requirement enables ANZ to :

• Reduce reliance on offshore short term funding markets

• Limit benchmark issuance in offshore markets

• Maintain a consistent & sustainable funding program

• Provide flexibility in issuance timing

• Stable AA category credit ratings across all major rating agencies despite ongoing bank ratings downgrades

50

100

150

200

2007 2008 2009 2010 2011 2012

ANZ Westpac NAB CBA

ANZ Westpac NAB CBA

Loan – Deposit Ratio (%) 130% 158% 152% 141%

Loan – Deposit Gap ($b) 100 186 165 156

Australia Household Funding Gap ($b) 112 193 124 171

Australian Household Funding GapANZ has built a sustainable balance sheet

Liquid assets of $115b provides a high level of coverage

and significantly exceeds total offshore debt outstanding

46

35 47

62

9

13

15

31

31

38

75

91

115

62

19

75 81

Sep 10 Sep 11 Sep 12 Wholesale Debt

Securities Maturing in FY13

Total Offshore

Debt Securities

AUDb

Liquidity portfolio exceeds total FY13 wholesale debt maturities and entire

offshore debt portfolio

Internal RMBS Offshore Short Term Debt

Private Sector Securities & Gold Offshore Term Debt

Cash, Government & Semi-Government Securities

Hedging has negated the impact on earnings of sustained $A strength

0.8%

0.4%

-0.1%

-0.4%

2H12 HOH FY12 YOY

Inclusive of Hedging Unhedged

47

AUD 62%

NZD 18%Hedges in place for ~60% FY13

earnings

Non AUD & NZD 20%

Hedges in place for ~50% FY13

earnings

USD

CNY

IDR

OtherPGK

MYRTWD

FY12 Earnings Composition by Currency EPS Impact from Hedging

12FULL YEAR



25 October 2012


Risk Management

Credit quality in line with expectations

49

Credit Quality Trends Provision Charge

• The provision charge of $1.25 billion was

broadly in line with last year, albeit the mix of

collective and individual provisions differed

• ANZ remains appropriately provided for with

the total provision coverage ratio at 1.78%

and the collective provision ratio at 1.08%

• Gross impaired assets reduced 7% YOY and

3% HOH

• New impaired assets declined 22% HOH

• All divisions saw HOH decreases in new

impaired assets with the exception of

Australia, with increases predominantly in

regional agri-business

• Increased individual provisions reflected losses

associated with two large single names.

Management overlays have been released in

relation to these movements as the rest of the

portfolio is now less concentrated

Impaired Assets

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12

$mGross Impaired Assets New Impaired Assets

-0.20%

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

1.60%

-250

0

250

500

750

1,000

1,250

1,500

1,750

2,000

1H

07

2H

07

1H

08

2H

08

1H

09

2H

09

1H

10

2H

10

1H

11

2H

11

1H

12

2H

12

$m Collective provision Charge

Individual Provision Charge

Total Provision Charge as % Avg. net Advances

Exposure composition by Geography and Asset Class

50

Exposure at Default by Geography(Sep 2012)

1. Inclusive of exposure booked to large multi-nationals doing business in Asia-Pacific

65%

2%

3%

3%

4%1%

16%

3%

3%

Australia

Other North East Asia

NewZealand

UK&

Europe1

Americas

Pacific

Other South East Asia

Hong Kong

Singapore

Asia & Pacific

13%

37%

10%

7%

39%

3%

5%

Corporate &Specialised Lending

Sovereign

Bank Residential Mortgage

QRR Other retail

Exposure at Default by Basel Asset Class(Sep 2012)

Control Lists and Risk Grade Profiles

51

6% 6% 6% 6% 5% 5%9% 9% 8% 8% 7% 8%

13% 13% 12% 12% 12% 11%

13% 14% 14% 13% 15% 14%

59% 58% 60% 61% 61% 62%


0

50

100

150

200

250

300

Sep-0

8

Mar-

09

Sep-0

9

Mar-

10

Sep-1

0

Mar-

11

Sep-1

1

Mar-

12

Sep-1

2

Control List by Limits Control List by No. GroupsIndex Sep 2008 = 100

Control List

6% 6% 6% 6%5% 5%

9% 9%8% 8%

7% 8%

13%13%

12% 12%

12% 11%


29%28%

27%26%

24% 23%

Group Risk Grade profile by Exposure at Default

59% 58% 60% 61% 61% 62%

13% 14% 14% 13% 15% 14%13% 13% 12% 12% 12% 11%9% 9% 8% 8% 7% 8%6% 6% 6% 6% 5% 5%


AAA to BBB BBB- BB+ to BB BB- <BB-

BB+ and lower rated exposures by Exposure at Default

13% 13% 12% 12% 12% 11%

9%9%

8% 8%7% 8%

6%6%

6%6%

5% 5%


BB+ to BB BB- <BB-

Continued improvement in Credit RWA rate

52

Exposure at Default and Credit Risk Weighted Assets

552

512 522 550 564

615 630

658

258 230 220 234 233

249 250 255

47%

45%

42% 42%41%

40%

40%

39%

1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12

Exposure at Default ($b) Credit Risk Weighted Assets ($b) CRWA / EAD (%)

Risk Weighted Assets

53

280.0300.1

7.710.0 2.2 0.2

Sep 11 Australia IIB NZ GWPB Sep 12

220234 233

249 250 255

29

31 31

3135

45

249

264 264

280285

300


Market & Operational Risk Weighted Assets

Credit Risk Weighted Assets280.0

300.16.0 5.6 8.5

Sep 11 Credit Risk Market Risk

Operational Risk

Sep 12

Total Risk Weighted Assets ($b)

Total Risk Weighted Assets Movement by Division FY12 v FY11 ($b)

Total Risk Weighted Assets Movement FY12 v FY11 ($b)

1

1. Driven by improvements to operational risk capital model

248.8 254.914.2

(1.7) (2.8) (3.6)

Sep 11 Growth Data Review

FX Impact

Risk Sep 12

Credit Risk Weighted Assets

54

248.8 254.94.2 1.4 0.1 0.4

Sep 11 Australia IIB NZ GWPB Sep 12

Credit Risk Weighted Assets ($b)Credit Risk Weighted Assets Movement FY12 v FY11 ($b)

Credit Risk Weighted Assets Movement by Division FY12 v FY11 ($b)

258

230220

234 233249 250 255

1.06%

1.32%1.38%

1.35%1.36%

1.28%

1.20%

1.08%

Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Sep 11 Mar 12 Sep 12

Credit Risk Weighted Assets

Collective Provision as a % of CRWA

0

500

1,000

1,500

2,000

2,500

3,000

3,500

1H10 2H10 1H11 2H11 1H12 2H12

Institutional Australia New Zealand Other

Impaired Assets by Division

55

3,126

2,3192,436

1,824

2,335

0

1,000

2,000

3,000

4,000

5,000

6,000


Institutional Australia New Zealand Other

4,9694,685

4,504

3,8843,629

$m$m

New Impaired Assets Net Impaired Assets

1847

3,423

Gross Impaired Assets

56

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000


$mImpaired Loans NPCCD Restructured

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000


$m> $100m $10-$99m < $10m

6,561 6,5616,221

6,561 6,5616,221

5,581 5,5815,343 5,343

Gross Impaired Assets by Type Gross Impaired Assets by Size of Exposure

5,196 5,196

Individual Provision Charge

0

200

400

600

800

1,000

1,200

1H10 2H10 1H11 2H11 1H12 2H12

$m

Institutional Commercial Consumer

57

1,062

762

594

-500

0

500

1,000

1,500

1H10 2H10 1H11 2H11 1H12 2H12

$m

New Increased Writebacks & Recoveries

912

0

200

400

600

800

1,000

1,200

1H10 2H10 1H11 2H11 1H12 2H12

$m

Australia New Zealand APEA

1,062762

594

1,062

762594

609

609

609

717

717

717

Individual Provision Charge composition

Individual Provision Charge by Region

Individual Provision Charge by Segment

912

912

-400

-300

-200

-100

0

100

200

300

400

500

1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12

$m

Lending Growth Net Economic Cycle & Concentration Risk Profile Portfolio Mix

Collective Provision Charge

58

(96) 331 36 (40) 65 (58) (152) (226)

Collective Provision Charge by Source

Collective Provision Charge by Source

59

FY12 ($m) Risk ImpactLending Growth

Portfolio Mix

Economic Cycle & Concentration

Total

Australia Division 10 53 (22) (79) (38)


(198) 90 10 (201) (299)

New Zealand Businesses (6) 4 (1) (42) (45)

Global Wealth & PrivateBanking Division

(3) 1 1 0 (1)

Other 0 0 0 5 5

Total (196) 148 (12) (318) (378)

2H12 ($m) Risk ImpactLending Growth

Portfolio Mix

Economic Cycle & Concentration

Total

Australia Division 1 30 (13) (44) (27)


(27) 38 3 (198) (184)

New Zealand Businesses 5 6 (1) (29) (19)

Global Wealth & PrivateBanking Division

(1) 0 0 0 (1)

Other 0 0 0 4 4

Total (22) 74 (11) (267) (226)

Collective Provision Balance

60

Collective Provision Balance ($m)

0

500

1,000

1,500

2,000

2,500

3,000

3,500

1H10 2H10 1H11 2H11 1H12 2H12

Modelled CP Charge Management overlay

862

597

44

19829

6

1H12 Australia IIB NZ Other 2H12

Management overlay balance movement 2H12 v 1H12 ($m)

29.4%37.3% 38.8% 42.2%

28.3%

31.3% 27.4% 17.6%

11.2%

4.7% 11.4%16.3%

31.1%26.7%

22.4% 23.9%

Sep 10 Sep 11 Mar 12 Sep 12

10-50m 51-100m 101-200m >200m

Impaired Asset Concentration

61

Impaired Assets Concentrationby value of Impaired Assets

72% 76% 78%82%

20%19% 16% 11%

4% 2% 3% 4%4% 3% 3% 3%

Sep 10 Sep 11 Mar 12 Sep 12

10-50m 51-100m 101-200m >200m

Impaired Assets Concentration by number of Customers

Exposures >$10m Exposures >$10m

Total lending exposures by Industry Sector

62

Category EAD% in Non

Performing

Sep-11 Sep-12 Sep-11 Sep-12

Consumer Lending 43.6% 41.0% 0.3% 0.3%

Finance, Investment & Insurance

14.5% 14.9% 0.3% 0.5%

Property Services 7.1% 7.5% 1.9% 1.6%

Manufacturing 5.9% 6.0% 1.9% 1.2%

Agriculture, Forestry,Fishing

4.5% 4.5% 4.4% 3.9%

Government & Official Institutions

4.4% 4.2% 0.0% 0.0%

Wholesale trade 3.2% 3.9% 0.8% 0.6%

Retail Trade 2.6% 2.9% 0.7% 0.9%

Transport & Storage 2.1% 2.3% 0.7% 3.2%

Business Services 1.8% 2.0% 1.1% 0.9%

Electricity, Gas & Water Supply

1.7% 1.8% 0.0% 0.2%

Construction 1.6% 1.7% 4.5% 1.4%

Resources (Mining) 1.5% 1.6% 0.1% 0.2%

Other 5.5% 5.7% 0.1% 0.1%

41%

15%

8%

6%

5%

4%

4%

3%

2%2%

2%2%

2%6%

Exposure at default (EAD)as a % of group total

Manufacturing

63

Total Exposure by Geography (EAD)Risk Rating Profile

(% of EAD)

0

10

20

30

40

Sep-10 Sep-11 Sep-12

$b

APEA Australia New Zealand

Exposure Mix by Geography (EAD)

35% 43% 48%

49% 43% 41%

16% 14% 11%


APEA Australia New Zealand

3% 5%1%

10%14%

3%

13%

17%

9%

26%

22%

30%

48%42%

57%

Group Australia APEA

59% 58% 60% 61% 61% 62%

13% 14% 14% 13% 15% 14%13% 13% 12% 12% 12% 11%9% 9% 8% 8% 7% 8%6% 6% 6% 6% 5% 5%


AAA to BBB BBB- BB+ to BB BB- <BB-

Resources

64

62%

5%

15%

18%

Australia

New Zealand

Asia

Europe, America, Pacific & Other

02468

1012


$b

Australia Non-Australia

Resources Exposure by Geography (EAD)

Resources Exposure by Geography (EAD)

23%

18%

28%

18%

13%

Oil & Gas Coal

Metal Ore Mining Services

Other

Resources Total Committed Exposure (EAD)

Includes Iron Ore 7%

21.319.9 20.8 21.3 21.7 21.6

6.1

5.25.8 5.0 4.9 5.0

0.8

1.01.1 3.1 3.4 3.4

6.4%

6.6%

6.8%

7.0%

7.2%

7.4%

7.6%

7.8%

8.0%

0

5

10

15

20

25

30

35

Sep-08 Sep-09 Sep-10 Sep-11 Mar-12 Jun-12

Australia New Zealand

APEA As a % of Group GLA's

Commercial Property Credit Exposure

65

28%

28%

25%

14%3%

2%

Offices

Retail

Residential

Industrial

Tourism

Other

$b

Commercial Property Exposure by Sector: Australia

Commercial Property ExposureGLA by Region

28.2

30.0

26.127.8

29.330.0

32%68%

Exposure to REITs, Listed Property Companies and/or their subsidiaries

Exposure toREITs, listed

property companies and/or their subsidiaries

Other Commercial

Property

66

Australia 90+ day delinquencies

0.0%

0.5%

1.0%

1.5%

2.0%

Mar 08 Sep 08 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Sep 11 Mar 12 Sep 12

Total Mortgage Portfolio NSW & ACT Mortgages QLD Mortgages

VIC Mortgages WA Mortgages Total Credit Cards

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

Mar 08 Sep 08 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Sep 11 Mar 12 Sep 12

Business Banking Regional Commercial Banking Esanda Small Business Banking Total Commercial

Australia Retail 90+ day delinquencies

Australia Commercial 90+ day delinquencies

67

Australia Division - Commercial

Commercial Australia Security Cover

13% 11%19% 19% 18%

4% 4%

5% 5% 5%10%10%

10% 11% 11%

27%26%

24% 23% 23%

46% 49%42% 42% 43%

Sep-10 Mar-11 Sep-11 Mar-12 Aug-12

<40% 40%-59% 60%-79%

80%-99% >100%

Exposure at default (EAD)

by industry sector (%)

15.9%

16.5%

13.5%5.8%

8.4%

5.7%

4.9%

4.1%

2.0%3.3%1.3%

0.6%

17.9%

Property Services Agriculture, Forestry & Fishing

Retail Trade Business Services

Construction Manufacturing

Wholesale Trade Accommodation, Cafes & Restaurants

Health & Community Services Transport & Storage

Finance & Insurance Mining

Other

68

0%

10%

20%

30%

40%

50%

60%

0-60% 61-75% 76-80% 81%-90% 91-95% 95%+

% Portfolio

Sep 10 Mar 11 Sep 11 Mar 12 Sep-12

Portfolio >90% LVR

= 5% (Sep-12)

Portfolio Statistics

Total Number of Mortgage Accounts 848k

Total Mortgage FUM $182b

% of Total Australia Region Lending 60%

% of Total Group Lending 43%

Owner Occupied Loans - % of Portfolio 63%

Average Loan Size at Origination $262k

Average LVR at Origination 64%

Average Dynamic LVR of Portfolio 52%

% of Portfolio Ahead on Repayments1 49%

First Home Owners - % of Portfolio 9%

First Home Owners - % of New Lending 8%

Australia Division – Mortgages

1. One month or more ahead of repayments. Excludes funds in offset accounts.

26%

19%

29%16%

10%

NSW & ACT

QLD

VIC

WA

Other

Mortgages have low loss rates

Individual Provision Loss Rates

1H10 2H10 1H11 2H11 1H12 2H12

Group 0.62% 0.42% 0.32% 0.31% 0.36% 0.43%

Australia Mortgages 0.02% 0.01% 0.01% 0.03% 0.03% 0.02%

Dynamic Loan to Valuation Ratio

Mortgage Portfolio by State (Sep 2012)


69

0.00%

0.40%

0.80%

1.20%

2007 2008 2009 2010 2011 2012

Mortgages Commercial Rural

-100

0

100

200

300

400

1H10 2H10 1H11 2H11 1H12 2H12

NZDm

IP Charge CP Charge

1,153

1,442

1,669

1,298 1,165

985

1.31%

1.63%

1.89%

1.49%

1.34%

1.09%


NZDm

Net Impaired Assets NIA as % GLA

351

16598 119

102

Total provision charge

90+ Days arrears

Net impaired assets

89

1. Spikes in 2012 Commercial 90 day delinquencies are primarily due to internal classifications rather than any deterioration in underlying credit quality.

1

12FULL YEAR



25 October 2012


Australia Division

Meeting changing customer expectations

• Customers want:

Greater mobility and flexibility around their banking

Better customer experience

Greater understanding of their needs and targeted offerings

Greater need for productivity

• Slower volume environment increases the need for simple products and processes to lower the cost to serve

Increased competition for liquidity

• Post FY08, deposits have increased from approximately 50% to 61% of funding

Challenging macro-economic dynamics

• Slower economic growth leading to lower credit growth

• Weaker consumer confidence

• Margin erosion (i.e. increased funding costs)

Increased regulation

• Changing capital requirements

• Higher compliance costs

We‟re transforming the business to adapt to the changed banking environment

71

Initiated productivity agenda focused on „right-sizing‟ the business and reducing cost to serve

• Expenses down 1% HOH

• Despite slowing revenue environment, we‟ve maintained CTI at ~40% to 41% since FY09

Disciplined management of pricing, discounting and balance sheet composition

• Self funding the loan book

• Focus on service and empowering our customers rather than be a price leader

Implemented customer segment strategy targeting high value customer segments in both Retail and Commercial

• Grown share of wallet and increased market share in traditional banking

• Above system growth in household and business lending and household deposits

Launched the “Banking on Australia” investment program

• Simplifying the way we do business

• Branch Network Reconfiguration

• Digital and mobile channels lower cost to serve and create additional revenue opportunities

• Improving sales effectiveness and lowering cost to serve in our Commercial business

• Investing in customer understanding & insight to improve targeting

ANZ ResponseDomestic challenges

45.0

50.0

55.0

60.0

65.0


We are making good progress on our strategic agenda

72

1. Source: Roy Morgan Research: Aust Pop‟n aged 14+, rolling 12 months, Trad Banking Consumer Market (Deposits, Cards & Loans), Peers: CBA (excl Bankwest), NAB, Westpac (excl Bank of Melbourne & St George)

21

10

11

12

13

14

15

16


21

Retail Traditional Banking Market Share1

(%) Market share – Traditional Banking


22

23

21

Aug-12

1. Targeting high-value customer segments with tailored banking propositions

• Market share gains in traditional banking, affluent and household deposits and lending

• Continuing to grow share of wallet and focusing on higher value retail and commercial segments

2. Leveraging our super-regional strengths

• The only Australian bank with the ability to connect customers across Asia, New Zealand and Australia

• Becoming the bank of choice for migrant customers

3. Good traction on the Banking on Australia agenda

• 46 new look branches to be completed by end of 2012 as part of 5 year branch refurbishment program

• Roll out of Cisco videoconferencing to 44 rural and remote branches by end of 2012

• ANZ goMoney continues to be a recognised leader in mobile banking applications

• Launched ANZ FastPay - processes same day credit and debit card transactions using an iPhone or iPad

4. Achieving market recognition

• Awarded Money Magazine‟s Bank of the Year and Home Lender of the Year and Capital CFO‟s Business Bank of the Year

5. Delivering strong 2H12 and FY12 outcome

• Underlying profit up 10% HOH and 4% YOY

• Positive Jaws in 2H12 and FY12 with expenses down 1% HOH

• Net interest margin recovery in 2H12

• Credit quality sound in both Retail and Commercial

Retail Traditional Banking Share of Wallet1

Aug-12

(%) Share of Wallet – Traditional Banking


Australia Division – Financial performance

Retail: Underlying profit1

Commercial: Underlying profit1

1,385 1,417 1,475

692 730 660 815

0

500

1,000

1,500

FY10 FY11 FY12 1H11 2H11 1H12 2H12

$m

Australia division: Underlying profit1

2,297 2,390

2,492

1,134 1,268

1,187 1,305

0

500

1,000

1,500

2,000

2,500

3,000

FY10 FY11 FY12 1H11 2H11 1H12 2H12

$m

912 973 1,017

442 538 531 486

0

500

1,000

1,500

FY10 FY11 FY12 1H11 2H11 1H12 2H12

$m

73

1. Statutory profit is adjusted to exclude certain non-core items to arrive at underlying profit

74

2,390

2,492

142 9

57

53

45

FY11 NetInterest

Other Income

Expenses Provisons Tax and OEI

FY12

$m

1,187

1,305

176 22 19

48 51

1H12 NetInterest

Other Income


2H12

$m

Australia Division – Financial performance

Underlying NPAT movement – FY12 v FY11

Underlying NPAT movement – 2H12 v 1H12

Up 4%

Up 10%

75

Australia Division – Net Interest Margin

Net Interest Margin• Net interest margin has declined since

1H10, primarily impacted by:

Deposit margins adversely impacted by increased competition for deposits driven by regulatory and funding requirements

Deposit mix impact with increasing customer preference for term deposit and on-line offerings

Increased average cost of term wholesale funding

• 1H12 margins negatively impacted by widening of short term wholesale spreads, which have improved in 2H12

• 2H12 operating income up 6% and NIM up 4 bps driven by tighter margin management offset by increased funding costs, in particular deposit costs remain elevated

• Pressure on margins likely to continue in FY13, however ongoing margin management is expected to offset headwinds

2.35

2.40

2.45

2.50

2.55

2.60

2.65

3,000

3,100

3,200

3,300

3,400

3,500

3,600

3,700

1H10 2H10 1H11 2H11 1H12 2H12

Revenue (LHS) NIM (RHS)

$m %

Australia Division - Building greater productivity into our businessStrategy

• Sustainable cost reduction through strategic transformation and simplification initiatives

Digital online and mobile channels

Branch network reconfiguration

Product simplification and improvement

Automation of manual processes

Right-sizing our enablement functions for the current environment

Better alignment of organisational structures between individual businesses

Use of regional support hubs

• While at the same time generating additional revenue streams through a broader range of sales and servicing activities via digital and retail distribution channels and cross-sell

Outcomes 2012

• Implemented initiatives to deliver productivity savings via task elimination & automation, process improvement, better workforce management and improved queue management

• Absorbed a 14% increase in volumes and tasks for Australian Operations in FY12 while maintaining SLA‟s and reducing costs by 4%

• Monthly customer complaints down 4% in FY12

Australia DivisionCost to Income Ratio (%)

1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12

36%

38%

40%

42%

44%

46%

48%

Peer High

Peer Low

Peer Average

ANZANZ Average

Note: Seasonality in ANZ 1H cost growth due to annual salary

increases

76

6,967 7,118

426

265

553

12

FY11 Volume Asset Pricing Funding Costs Other FY12

$m

Australia Division – Operating Income and Expenses

77

Operating expenses movement FY12 v FY11

Operating income movement FY12 v FY11

2,836

2,893 35

60

39

FY11 Personnel Projects &

RestructuringOther FY12

$m

Up 2%

Up 2%

1,427

1,456 1,437 12

39

22 7 8 3

2H11 Personnel Projects &

RestructuringOther 1H12 Personnel Projects &

RestructuringOther 2H12

$m

3,531 3,460

3,658 105

8

156 12

115

226

163

18

2H11 Volume Asset Pricing Funding Costs

Other 1H12 Volume Asset Pricing Funding Costs

Other 2H12

$m

Australia Division – Operating Income and Expenses

78

Operating expenses movement HOH

Operating income movement HOH

Down 2% Up 6%

Up 2% Down 1%

Retail – Delivering a distinctive customer proposition and transforming the distribution network

79

1. Delivering tailored offerings across banking targeting high value customer segments

• Customer segment strategy focusing on Young Money, Professionals and Executives, Affluent 50+, International and Small Business owners

• Traditional Banking market share up 0.6% to 13.7% (12 months to Aug 2012)2

• Affluent Traditional Banking market share up 0.7% to 14.9% (12 months to Aug 2012)2

• Above system growth in household lending (1.2x system) and household deposits (1.2x system)

2. Transforming the distribution network through branch reconfiguration and development of mobile and digital capabilities

• Reconfiguring the distribution network, including branches, to deliver improved customer experience and cost efficiency

• Developing online and mobile digital channels to meet customer expectations for greater mobility and flexibility around their banking

3. Delivering a distinctive Retail customer proposition through greater understanding of customer needs and targeted offerings

• Investing in analytic capabilities to drive greater customer insight and better address customer needs

• Delivering targeted customer offers aligned to customer needs and preferences

• Simplifying products and processes to make things easier for our customers and people

Indexed Mar 2010 = 100

Indexed Mar 2010 = 100

Household Lending Growth1

Household Deposit Growth1

90

100

110

120

130

140

Mar-10 Sep-10 Mar-11 Sep-11 Mar-12

ANZ CBA NAB WBC

90

100

110

120

130

140

Mar-10 Sep-10 Mar-11 Sep-11 Mar-12

ANZ CBA NAB WBC

1. Source: APRA2. Source: Roy Morgan Research: Aust Pop‟n aged 14+, rolling 12 months, Trad Banking Consumer Market (Deposits, Cards & Loans), Peers: CBA (excl

Bankwest), NAB, Westpac (excl Bank of Melbourne & St George)

Aug-12

Aug-12

80

1,417

1,475

83 4

38

36

27

FY11 NetInterest

Other Income


FY12

$m

660

815 175

20 5

15 60

1H12 NetInterest

Other Income


2H12

$m

Retail – Financial performance



• Net interest income increased by 2% YOY through growth in mortgage lending and margin management, partially offset by the impact of declining deposit margins and higher funding costs

• NIM reduced by 12 bps due to increasing deposit costs

• Expense growth was contained to 2% with the impact of annual salary rises, inflation and project investment being offset by productivity initiatives

• Provision expense was down 9% driven by improved delinquency trends in the mortgages portfolio and the release of surplus collective provisions

• Net interest income increased by 10% in the half primarily due to margin improvement and above system growth in household lending

• 1% reduction in costs for the second half with benefits emerging from productivity program

• NIM improved by 4bps in the half due to management of pricing, discounting and balance sheet composition

• Provision expense reduced by 8% due to improved delinquency trends and the release of surplus collective provisions

Up 4%

Up 23%

Retail – Balance Sheet

81

Customer Lending Customer Deposits

3.6

0.5

0.2

180.7

189.4

192.7

Sep 1

1

Mar

12

Mort

gages

Consum

er

card

s &

Unsec.

Lendin

g Oth

er

Sep 1

2

$b

1.0

4.7 0.1

87.3

91.9

97.6

Sep 1

1

Mar

12

Mort

gage O

ffset

Deposits

Oth

er

Sep 1

2

$b

Retail – Branch network reconfiguration: improving customer experience and lowering cost to serve

82

Re-defining the retail customer experience with technology

enabled, open plan branches…

• A new branch design with sales capabilities aligned to changing customer demand

• Becoming centres of advice for complex customer needs, as everyday transaction numbers decline

• Greater access to specialists through use of in-branch video conferencing facilities

Roll out of Cisco videoconferencing to 44 rural and remote branches by end of 2012

• Branch footprint designed to maximise sales capability and incorporate new technologies

Reduce excess space in our branch property portfolio by approximately 36%

25% reduction in property expenses expected over time

• 800 „next generation‟, deposit taking ATMs to be rolled out to branches commencing June 2013 allowing 24/7 access to many traditional teller services

• Providing access to simple wealth products to meet customer needs

Initial rollout to 200 branches by end of 2012

New generation intelligent ATM‟s with

greater functionality

Branch: York & Market, Sydney

Retail – Right sizing our branches and increasing sales capability

• A circa 5 year program, 46 branches to be completed in Calendar 2012

• Align our branch footprint to changing customer demand and improve productivity (more complex activities performed in branch, better customer discussion facilities, etc.)

• Right sizing our branches, improving the proportion of usable floor space (significant reduction in back of house space requirements) and moving to a more flexible layout

• In tandem with an improving online and digital offering

Example of improved space utilisation

Branch: Booragoon, Western Australia

83

Metro/ Suburban

Branch

Net lettable area ↓ c.40%

Back of house requirement ↓ c.70%

Consulting room and sales points ↑

Retail – Developing new channels in line with shifting customer preferences

84

… and peer-leading mobile platforms

Intuitive next generation online platforms…

• Growing customer preference for self-service channels with digital transactions accounting for more than 64% of all ANZ transactions processed

• Generating additional revenue streams through greater functionality and cross-sell opportunities while lowering the cost to serve

• ANZ goMoney a recognised leader in mobile banking applications

Over 780,000 registered users

30 million transactions totalling $17 billion conducted in the past 12 months (Sep 2012)

Available on up to 5 simultaneous devices

Android version launched in September 2012

• Enhanced Internet Banking functionality allows customers to do more of their banking without the involvement of branches or call centres

Includes travel notifications, adding Cardholders, eStatements

359 million transactions totalling $600 billion have been conducted over the past 12 months (Sep 2012)

• Trialling ANZ mobile wallet using NFC technology on Android devices

85

0%

10%

20%

30%

40%

50%

60%

0-60% 61-75% 76-80% 81%-90% 91-95% 95%+

% Portfolio

Sep 10 Mar 11 Sep 11 Mar 12 Sep-12

Portfolio >90% LVR = 5% (Sep 12)

Portfolio Statistics

Total Number of Mortgage Accounts 848k

Total Mortgage FUM $182b

% of Total Australia Region Lending 60%

% of Total Group Lending 43%

Owner Occupied Loans - % of Portfolio 63%

Average Loan Size at Origination $262k

Average LVR at Origination 64%

Average Dynamic LVR of Portfolio 52%

% of Portfolio Ahead on Repayments1 49%

First Home Owners - % of Portfolio 9%

First Home Owners - % of New Lending 8%

Retail – Mortgages

1. One month or more ahead of repayments. Excludes funds in offset accounts.

26%

19%

29%16%

10%

NSW & ACT

QLD

VIC

WA

Other

Mortgages have low loss rates

Individual Provision Loss Rates

1H10 2H10 1H11 2H11 1H12 2H12

Group 0.62% 0.42% 0.32% 0.31% 0.36% 0.43%

Australia Mortgages 0.02% 0.01% 0.01% 0.03% 0.03% 0.02%

Dynamic Loan to Valuation Ratio

Mortgage Portfolio by State (Sep 2012)

86

Retail – Mortgages by channel

Sales mix

37%

46%51% 49% 46%

55%51%

63%

54%49% 51% 54%

45%49%

2H09 1H10 2H10 1H11 2H11 1H12 2H12

Broker Proprietary

38% 39% 41% 42% 43% 44% 46%

62% 61% 59% 58% 57% 56% 54%

2H09 1H10 2H10 1H11 2H11 1H12 2H12

Broker Proprietary

Portfolio mix

• Strengthening the sales capability of our network as part of the Banking on Australia program

• New automated mortgages platform largely rolled out across the network

• Broker originated mortgages remain an important channel and deliver a high proportion of new-to-bank and affluent customers

1. Source: APRA

Commercial – Leveraging our regional footprint and growing the customer base

87

Awarded Business Bank of the Year 2012

1. Growing through customer acquisition and increased cross-sell

• Focusing on acquiring new-to-bank customers

Targeting trading businesses with more complex, cross-regional needs

Acquired 30k net new clients in FY12

• Enhancing product and distribution propositions to increase cross-sell opportunities

Institutional cross-sell revenue up 25.1% YOY

Mortgages cross-sell revenue up 12.6% YOY

Investment and insurance cross-sell revenue up 27.7% YOY

• Increased lending and deposit FUM by 9% YOY

2. Leveraging our regional footprint and capabilities to meet customer needs

• Working closely with customers to provide better connections across the region

• Increased cross border referrals by 40% YOY

3. Improving productivity and customer experience

• Streamlining processes to provide more time with customers

• Investing in online and mobile platforms to deliver convenient and innovative banking solutions

Cross-sell income

Based on performance against the following criteria:

FY10 FY11 FY12

Strong cross-sell revenue growth

Product cross-sell revenue from other ANZ businesses ($m)

636

+12%

+3%

786

• Relationship management

• Advice

• Deal execution

• Client satisfaction

• Market share and penetration

• League table positions Business Bank of the Year

AFR Capital CFO Awards 2012

712

24% increase

1. Increased client awareness of our super regional strengths and upskilled staff

• Demonstrated our leading renminbi (RMB) capabilities to 700 customers and staff across 6 states

• Up-skilled 600 frontline staff across 5 cities and provided 80 bankers with hands-on experience in key Asian markets

2. Better connecting our customers across the region

• Increased cross-border referrals by 69% since 1H11 and 40% YOY

• Developed a standard global credit framework and principles providing customers with agile and timely cross border credit

3. Recognised by government entities for our leading capabilities across Asia

• Chosen by Victorian Government Trade Mission to provide participants with local insights on doing business and banking with China and India

4. Extending markets and trade product capability to our medium and small business clients

• Trade Finance revenue generated by Commercial clients up 20% YOY

• Global Markets revenue generated by Commercial clients up 40% YOY

342

431 505

579

1H11 2H11 1H12 2H12

Commercial – Capitalising on our super regional capabilities

69% increase

Cross-border referrals

Sources of cross-border referrals

44%

31% 19%

5%

1%

Asia

Australia

Other

Pacific

New Zealand

88

Intelligent use of technology driving improved customer experience

Commercial – Improving productivity and customer experience

• Enhancing frontline sales productivity by simplifying processes and systems to provide more time with customers

• Simplified customer on boarding with ANZ OneSwitch - 1 form, 1 signature, 1 week, 1 point of contact

• Using technology to enhance customer experience and offer greater control

On site needs analysis via tablet technology

ANZ Fastpay – „on the go‟ merchant transactions via iPad or iPhone

ANZ Transactive mobile app - „on the go‟ banking app for business customers

• Engaging with customers through social media platforms (Twitter, LinkedIn and the Small Business Hub)

• Fostering innovation by assisting prospective small business owners fast-track their development („ANZ Innovyz START Program‟)

ANZ OneSwitch has simplified

customer onboarding

649 applications since launch

Using tablet technology to enhance sales process

Creating applications to deliver convenient banking solutions

89

973

1,017 65 5

24

17

19

FY11 NetInterest

Other Income


FY12

$m

531

486

1 3 1

63

15

1H12 NetInterest

Other Income


2H12

$m

Commercial – Financial performance



• Net interest income up 3% YOY driven by balance sheet growth and margin management, partially offset by lower margins on deposits

• 3% expense growth from salary increases and investment in projects, partially offset by a reduction in FTE and productivity initiatives

• Neutral JAWS. Cost to Income ratio flat YOY at 34.2%

• Provisions down 6% with a reduced provision charge (release of $54m in FY12 of surplus flood provisions raised in March 2011) offset by lending growth and impact of current economic environment.

• Net interest income flat with asset repricing and volume growth (lending growth of 5%, deposit growth of 6%) offset by deposit margin declines

• Expenses flat reflecting benefits of restructuring activities and a continued focus on driving productivity savings

• Provisions up 57% HOH driven by an increase in individual provisions reflecting softer economic conditions across a number of sectors, partially offset by the release of surplus flood provisions

Up 5%

Down 8%

90

Commercial – Balance Sheet

Customer Lending Customer Deposits

0.90.6

0.8 0.3 0.0

47.8

49.3

52.0

Sep 1

1

Mar

12

Esanda

Regio

nal

Com

merc

ial

Bankin

g

Busin

ess

Bankin

g

Sm

all

Busin

ess

Bankin

g

Oth

er

Sep 1

2

$b

0.0

0.41.0

1.0

39.7

40.8

43.2

Sep 1

1

Mar

12

Esanda

Regio

nal

Com

merc

ial

Bankin

g

Busin

ess

Bankin

g

Sm

all

Busin

ess

Bankin

g

Sep 1

2

$b

27%

32%41%

Regional Commercial Banking

Business Banking

Small Business Banking

27%

32%

10%

30%

Regional Commercial Banking

Business Banking

Small Business Banking

Esanda

Lending composition (Sep 12) Deposit composition (Sep 12)

91

Commercial – Provisions

92

Provision charge

0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

0.90%

1.00%

-100

-50

0

50

100

150

200

250

1H11 2H11 1H12 2H12

Flood provision

Collective Provision ex-flood provision

Individual provision (LHS)

Total provision charge (ex-flood release) as % of NLA's (RHS)

$m$m$m$m

• Increased provision charge reflects increased lending volume in addition to softening of economic conditions across a number of sectors

• The provision charge for 2H12 was primarily driven by an increase in individual provisions

Circa 35% or $62m of the 2H12 individual provision related to Regional Commercial Banking reflecting pressure in Agri-business sector mainly QLD and NT

• Collective provision overlay relating to flood provision taken up in 1H11 has now been fully released

• While the portfolio remains well secured, the economic recovery following the floods has been slower than expected

Total provision charge ($m)

192 107 110 173

Commercial – Total lending exposures by sector

93

Exposure at default (EAD)by industry sector (%)

Category EAD % in Non Performing

Sep 12 Mar 12 Sep 11 Sep 12 Mar 12 Sep 11

Property services 15.9% 15.0% 14.7% 1.1% 1.0% 1.0%

Agriculture, forestry & fishing

16.5% 17.0% 17.0% 6.6% 5.8% 5.0%

Retail Trade 13.5% 14.5% 13.8% 1.3% 1.0% 1.2%

Construction 8.4% 8.5% 8.4% 1.6% 1.6% 1.4%

Business services 5.8% 6.0% 6.0% 1.1% 1.3% 1.3%

Manufacturing 5.7% 5.7% 5.8% 1.8% 2.0% 2.4%

Wholesale trade 4.9% 4.9% 4.9% 0.8% 0.8% 1.7%

Accommodation, cafes & restaurants

4.1% 4.1% 3.8% 1.5% 1.6% 1.6%

Heath & community services

2.0% 2.0% 1.9% 1.4% 1.6% 1.5%

Transport & storage 3.3% 3.4% 3.6% 1.6% 1.6% 1.7%

Finance & insurance 1.3% 1.3% 1.4% 2.2% 1.6% 1.2%

Mining 0.6% 0.5% 0.7% 0.8% 0.9% 0.7%

Other 17.9% 17.1% 18.0% 1.4% 1.3% 1.2%

15.9%

16.5%

13.5%5.8%

8.4%

5.7%

4.9%

4.1%

2.0%

3.3%1.3%

0.6%

17.9%

Commercial – Risk grade profiles

94

Commercial Australia Security Cover

13% 11% 11% 11% 11%

4%4% 4% 4% 4%

10%10% 10% 12% 12%

27%26% 26% 25% 24%

46% 49% 49% 49% 49%

Sep-10 Mar-11 Sep-11 Mar-12 Sep-12

<40% 40%-59% 60%-79% 80%-99% >100%

Weighted Average Customer Credit Rating

5.84

Sep-10 Mar-11 Sep-11 Mar-12 Sep-12

• The Commercial book is well secured with 72% of Commercial lending book being more than 80% secured

• Security Indicator (SI) profiles have decreased slightly from Sep-11, reflecting underlying changes in property values

• Average Customer Credit Rating (CCR) is stable YOY and has improved slightly from 1H12

0

5

10Impaired

Strong

Fair

8Weak

9

Australia Division – Balance sheet

95

Net Loans and Advances Deposits

215.0 228.5244.7

0.0

50.0

100.0

150.0

200.0

250.0


$b

Commercial Retail

90.9

104.1 101.6 103.918.2

6.2

2.7

1.6

11.4

10.0

2.1

6.0

12.0

10.3

4.1

3.5

Sep 0

9

Reta

il

Lendin

g

Reta

ilD

eposits

Com

mLendin

g

Com

m

Deposits

Sep 1

0

Reta

ilLendin

g

Reta

ilD

eposits

Com

mLendin

g

Com

mD

eposits

Sep 1

1

Reta

ilLendin

g

Reta

il

Deposits

Com

mLendin

g

Com

mD

eposits

Sep 1

2

$b

111.0127.0 140.8

0.0

50.0

100.0

150.0

200.0

250.0


$b

Commercial Retail

Funding

127.0

140.8

2.01.6

4.6 0.3

1.90.7 0.1

2.30.3

Sep 1

1

Term

Deposits

Online S

aver

Oth

er

Savin

gs

Tra

nsaction

Mort

gage

Off

set

Term

Deposits

Online S

aver

Oth

er

Savin

gs

Tra

nsaction

Sep 1

2

$b

Australia Division – Deposits

96

Customer deposit composition

45% 44% 43%

22% 23% 25%

12% 13% 12%

11% 11% 11%

9% 9% 9%

0%

20%

40%

60%

80%

100%

Sep 11 Mar 12 Sep 12

Term Deposits Other Savings Online Saver

Transaction Offset

FY12 deposit growth

Retail Commercial

Decreased reliance on term deposits

Progress

Saver up 86% YOY

Up 11%

Up 12% Up 9%

Australia Division – Outlook

Revenue growth

Expense growth

3%

0% 1%

6%

1H11 2H11 1H12 2H12

Provision charge

355 416309

278 302

357

FY10 FY11 FY12

$m Second Half First Half

4%

1%

3%

-1%

1H11 2H11 1H12 2H12

Revenue

• Above system growth in mortgages in FY12 provides good balance sheet momentum leading into FY13

• Targeting to grow lending at or above system in FY13

• Disciplined management of margins in FY12 to continue in FY13 to minimise downside from funding impacts

• Continuing to transform business to address revenue headwinds, including competition for deposits

Expenses

• Full year effect of productivity initiatives implemented in FY12 will be reflected in FY13

• However, seasonal impact of wage increases expected in 1H13

Provisions

• FY12 provision release associated with flood provisions not expected to recur in FY13

• Modest increase in 2H12 provisions likely to continue into FY13

• Continue to be cautious and disciplined in our approach to lending and risk management

97

12FULL YEAR

RESULTSAUSTRALIA AND NEW ZEALAND BANKING

GROUP LIMITED

25 October 2012


International & Institutional Banking (IIB)

International & Institutional Banking (IIB)

99

A new division that combines Global Institutional and Asia Pacific, Europe & America Divisions (APEA)

Global Institutional Banking

Institutional Australia

Institutional APEA(including Commercial Banking Asia Pacific)

Institutional New Zealand

Retail Banking Asia Pacific

Asia Partnerships

International & Institutional Banking Division (IIB)

Transaction Banking

Global Loans

Global Markets

Asia Pacific, Europe & America(APEA)

International & Institutional Banking – growing in line with strategy

100

• Super Regional strategy continues to build momentum

Growing in our priority markets

Delivering greater cross-border connectivity

With total cross-border income up 16% YOY

• Client growth focussed on key strategic segments

Delivering growth in key investment segments

Lower cost business model allows continued investment in priority segments

• Shifting business model and becoming a modern Institutional bank

Continuing to diversify income by product

Well funded, low risk balance sheet, loan to deposit ratio at Sep 2012 - 75%

42% of APEA Institutional lending book represents short-dated trade finance which grew 30% YOY

6%

16%

-2%

2%

14%

-8% -8%

7%15%

25%

46%

-4%

7%11%

17%25% 25%

Geographies

InstitutionalAustralia

APEACross-Border Income

Commercial Asia

Natural Resources

Financial Institutions

Affluent & Emerging Affluent

Infra-structure

Agriculture

Trade & Supply

Chain

Foreign Exchange

Investments & Insurance

Cash Management

Fixed Income

Global Loans

InstitutionalNew Zealand

Customer Segments

Products

Income Growth FY12 v FY11

IIBDivision

IIB Division

1. Represents referred income booked in a jurisdiction different to where a client relationship is managed.

1

2y CAGR+3%

2y CAGR+13%

Europe & America Asia Pacific Australia / New Zealand

Connectivity is a key differentiator for ANZ, driving cross-border income growth around the network

101

13%

8%

25%

40%

12%

4%

Referred Received Referred Received Referred Received

Total FY12 Cross-Border Income Up 16% to $1.4bRepresents 21% of IIB Income1

Cross-Border Income FY12

1. Total referred cross-border income as % total IIB income

Income Mix by Product Income Mix by Geography Deposit Mix by Geography

17%

16%

15%

34%

10%

8%

Transaction Banking

Markets Sales

Markets Trading & Balance Sheet

Global Loans

Retail

Partnerships / Other

22%

18%

11%

29%

14%

6%

Traditional Lending

50%

7%

43%

39%

7%

54%

51%

8%

41%



APEA

57%

8%

35%



APEA

Increasing geographic diversity and increasing contribution of value added and flow products

102

2010

2012

2010

2012

2010

2012

Transaction Banking & Markets Sales

YOY JAWS +4%

716 1,184

1,473 1,824

2,514 2,878

348 535 643 983

1,451 1,589


Income Expenses

Significant growth in APEA has been achieved against currency translation headwind

103

Asia Pacific, Europe & America Income & Expenses (USDm)

Asia Pacific, Europe & America Net Profit after Tax (USDm)

253

393

521618

763

934


Asia Pacific, Europe & America Contribution to Group Income

3% 3%

2% 2%

3%

11%

5%

FY07 FY12 FY17

Australia & NZ income derived from APEA1

Driving 25 to 30% of Group earnings by 2017

Asia

Pacific

Europe & America

1. Australia & NZ income derived from APEA not available for FY07

0.81 1.03Average AUD/USD

30% CAGR

Income 32% CAGR

21%

8%

Institutional Operating Income CAGR 2H09 – 1H12

Institutional Operating IncomeMajor Australian Banks

Super regional strategy giving us access to growth not available from a domestic only strategy

104

-1%

0%

21%

Institutional Businesses

Domestic Peers

ANZ Institutional

Australia / NZ

ANZ Institutional

APEA

0.5 0.5 0.6 0.6 0.6 0.8 0.8

1.9 1.8 1.9 2.0 1.82.0 1.8

4.0 4.1 3.7 3.63.4

3.9

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

2H09 1H10 2H10 1H11 2H11 1H12 2H12

AUDb ANZ Institutional APEA

ANZ Institutional Aust / NZ

Domestic Peers

FX Adjusted Growth 33%

ANZ as % of Pool

38% 37% 40% 42% 41% 42%

1. 2H12 not yet disclosed for all peers.

1

4,961

5,320

103

138

203

85

FY11

Mark

ets

Sale

s

Mark

ets

Tra

din

g &

Bala

nce

Sheet

Tra

nsaction

Bankin

g

Glo

bal

Loans

FY12

APEA franchise is a key driver of income growth

105

International & Institutional Banking Income (AUDm)

3,775 3,737 3,792

1,771 1,973 1,818

2,067 2,453

2,800

1,197

1,366 1,435

FY10 FY11 FY12 2H11 1H12 2H12


Global Institutional Income by Geography Movement FY12 v FY11 (AUDm)

Global Institutional Income by ProductMovement FY12 v FY11 (AUDm)

4,961

5,320

76

10

293

FY11 Australia New

Zealand

APEA FY12

5,8426,190

6,592

2,9683,339 3,253


1

Shifting our business model in response to the changing environment in Australia and New Zealand

106

Institutional Australia & New ZealandMargin & Balance Sheet Trends

Institutional Australia & New ZealandLending Income Mix

2.00%

2.20%

2.40%

2.60%

2.80%

3.00%

3.20%

3.40%

3.60%

3.80%

4.00%

0

10

20

30

40

50

60

70

80

1H11 2H11 1H12 2H12

AUDb

Lending Deposits NIM ex Mtks (RHS)

27% 30% 31% 33%

73% 70% 69% 67%

1H11 2H11 1H12 2H12

Value Added Lending Traditional Term Lending

Value Added Lending - Trade and Specialised Finance

Margin impacted by higher wholesale funding costs and competition for deposits and lending in Australia

107

IIB Net Interest Margin Movement 2H12 v 1H12 (bps)

195

1768

11

4

73

14


Funding Costs

Deposits Assets Other Markets 2H12

-3%

6%

-5%

4%

NII

AIEA

FY12 v FY11 2H12 v 1H12

2%

11%

-1%

6%

NII

AIEA

30%

40%

0%

14%

NII

AIEA

NII & Volume Growth


Institutional APEA


NII – Net Interest IncomeAIEA – Average Interest Earning Assets



1,481

1,457

16

2

34 4

1H

12 F

X A

dj

Dep. /

Am

ort

isation

Restr

uctu

ring

Pers

onnel

Oth

er

2H

12

AUDm

Adapting to the new environment by creating a more efficient, lower cost business model

108

IIB FTE Movement1

IIB Expense Growth 2H12 v 1H12IIB HOH Expense Growth (FX Adj)

5% 5%

-2%

2H11 1H12 2H12

AUD

16,625

16,121

Sep 2011 Support Retail Institutional Australia / NZ

Institutional APEA

Regional Hubs Sep 2012

+48m YOY

+35m YOY

1. Includes contract employees.

Productivity focus drove reduction in expenses 2H12 against more challenging macro environment

109

IIB NPAT(AUDm)

1,333

1,557 1,464

732 808 656

714

744 908

345

427

481

FY10 FY11 FY12 2H11 1H12 2H12


IIB NPAT Movement FY12 v FY11 (AUDm)

2,301 2,372

175

227

176

134 21

FY11

NII

OO

I

Expenses

Pro

vis

ions

Tax &

O

EI

FY12

1,235

1,137 46

40

19

77

46

1H

12

NII

OO

I

Expenses

Pro

vis

ions

Tax &

O

EI

2H

12

2,047

2,3012,372

1,077

1,2351,137 IIB NPAT Movement 2H12 v 1H12 (AUDm)


1

Return on Equity maintained in faster growing regions and products

110

IIB Product Return on Regulatory Capital1 (%)

IIB GeographyReturn on Regulatory Capital1 (%)

20%

21%

14%

16%

11%

22%

21%

11%

15%

14%

Global Markets

Transaction Banking

Global Loans

Partnerships

Retail Asia Pacific

2011 2012

16%

22%

17%

14%

12%

14%

19%

16%

14%

12%

IIB Division



Institutional APEA

APEA

2011 2012

1. Capital represents average Basel 2 RWA x 8.5% plus full year average capital deductions (such as investment in partnerships, software capitalisation, deferred acquisition costs, deferred income )

132.8

142.7

0.2 0.1

8.8 0.8

Mar

2012

Australia New

Zealand

APEA Retail

Asia Pacific

Sep

2012

AUDb

Institutional

IIB Customer Deposits & Lending

APEA franchise a differentiator in volume growth and continues to strengthen group balance sheet

111

0

20

40

60

80

100

120

140

160

Sep 10 Sep 11 Mar 12 Sep 12 Sep 10 Sep 11 Mar 12 Sep 12

AUDb

Institutional Australia Institutional NZ

Institutional APEA Retail Asia Pacific

Customer LendingCustomer Deposits

15% CAGR

18% CAGR

102.2

107.6

1.0

0.1

3.60.9

Mar

2012

Australia New

Zealand

APEA Retail

Asia Pacific

Sep

2012

AUDb

IIB Lending Movement 2H12 v 1H12

$2.5b Trade Finance

Loan to Deposit Ratio 75%

107.6

142.7

108.5

77.7

Institutional

129.7132.8

97.2102.2

IIB Deposit Movement 2H12 v 1H12

2% 1% 1% 1%2% 2% 2% 2%

9%6% 6% 5%

16%16%

15% 17%

71%75% 76% 75%


14%

5%

11%26%

19%

22%3%

Institutional APEA Asset Composition

Well diversified and high quality assets in APEA

112

AAA-BBB

BBB-

BB+~BB-

BB-

<BB-

Institutional APEA Risk Grade profile by Exposure at Default

Total External Assets Sep 2012 AUD95b

Liquid Assets

Trade Finance

Other Net Loans & Advances

Other Assets

Money Market

Securities

Derivatives

Due from Other Financial

Institutions

Impaired Assets have continued to decline, provision charge growth driven by legacy exposures in Australia

113

Global Institutional Provision Charge

3,5222,984

2,656

2,177 1,9961,913

4.5%

3.7%3.1%

2.3%2.1% 1.9%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

0

1,000

2,000

3,000

4,000

Mar 10Sep 10Mar 11Sep 11Mar 12Sep 12

As % GLAAUDm

Institutional net impaired assets % GLA (RHS)

432

283139

110

187

264

-300

-200

-100

0

100

200

300

400

500

600

700

1H10 2H10 1H11 2H11 1H12 2H12

AUDm

New IP Charge Increased IP Charge

Recoveries & Writebacks CP Charge

Total Provision Charge

2H12 Includes Large Single

Names

Global Institutional Net Impaired Assets

Global Institutional Provision Charge Movement 2H12 v 1H12

187

26466 8 3

1H12 Australia New Zealand

APEA 2H12

AUDm

Trade & Supply Chain - continuing to leverage regional trade network and build customer franchise in FY12

Income1 up +34% to $464m

Client growth of 15%

Asset growth of 20% across all regions

• Continuing to build Asian presence

Income growth of 57%, client growth 22%

Recognised as a leading regional trade bank, ranked No. 3 International Trade Bank in Indonesia and Philippines and No. 1 in Vietnam2

• Focusing on productivity and efficiency resulted in 5% decrease in expenses and significant ROE uplift

Payments & Cash Management - growing customer base and transaction flow in FY12

PCM customers grew 20%, 80% of this in Asia

Global average cash volumes3 increased by $11bn to $67bn

• Deployed ANZ Transactive into key geographies including Singapore, Hong Kong and the Pacific

• Continuing to deliver market leading solutions:

ANZ Transactive mobile application

Cashactive - a web-based liquidity solution that simplifies receivable and reconciliation activities

Transaction Banking

114

Trade & Supply Chain Total Limits & Transaction Volumes1

Payments & Cash Management ANZ Transactive Volumes and Value

020406080100120

0

2

4

6

8

Oct-

11

Nov-1

1

Dec-1

1

Jan-1

2

Feb-1

2

Mar-

12

Apr-

12

May-1

2

Jun-1

2

Jul-

12

Aug-1

2

Sep-1

2

AUDbmillionsTxn Volume (LHS) Txn Value (RHS)

1. Excluding non-trade guarantee income2. Trade Finance Magazine, Awards for Excellence, 2012

3. Cash volumes include clearing balances

0

200

400

600

0

10

20

30

40

50

1H10 2H10 1H11 2H11 1H12 2H12

„000‟sAUDb Funded Exposures

Unfunded Exposures

Transactions (RHS)

Global Markets

115

Global Markets Income by Activity

Global Markets Income by Product

0

500

1,000

1,500

1H10 2H10 1H11 2H11 1H12 2H12

AUDm Sales Trading Balance Sheet

• APEA continued to show strong growth with total income up 26% YOY and now represents 40% of Markets income

• Sales income was up 9% YOY due to a broadening of our client base with Capital Markets up 6%, Investor Sales up 23% and Wealth Sales up 33% YOY

• Sales income HOH was down 16% reflecting low volatility and a softening economy in 2H12.

• However, all regions showed continued growth from FY11 to FY12 in line with our strategic objectives

• Trading and Balance Sheet income grew 23% YOY, reflecting a recovery from the volatile trading environment experienced in late 2011

• Continued focus on FX as a priority product resulted in income growth of 17% YOY and now represents 39% of Markets income

• Progress in FX is reflected in ANZ‟s rankings in recent 2012 FX Polls

Asiamoney - No. 2 in FX Services to Financial Institutions

Asiamoney - No. 5 in FX Services to Corporates

Euromoney – Best in Asian Currencies

0

500

1,000

1,500

1H10 2H10 1H11 2H11 1H12 2H12

AUDm Foreign Exchange Fixed Income

Capital Markets Other

953864

988

701

1,022909

953864

988

701

1,022909

Category Q3 2012 2011

Rank VolumeUSDb

% mkt

No. Issue

Rank

Australia (MLA) 1 8.6 18.4 70 1

Asia-Pac ex-Japan (MLA)

1 13.7 7 136 1

Asia (MLA) 17 3.1 1.8 42 16

Asia (Bookrunner)1 8 1.7 3.5 18 9

Debt Capital Markets

116

Asian Capital Markets platform delivering growth

• Building deeper relationships in Asia with key distribution clients - hedge funds, pension funds sovereigns, life insurers and HNW / Affluent

• Introduced ~400 new investors globally in FY12

• Distribution capabilities increasing the velocity of balance sheet and broadening our reach with clients

Maintained strong presence in Home Markets

• #1 in Australia for MLA and Bookrunner for all League Tables and including #1 MLA New Zealand (Bloomberg)

• #1 in Australia for Bonds excluding self-led deals with 17.6% market share (6.5% ahead of nearest competitor)

• #1 in NZ for Bonds with 49% market share excluding self led deals

A market leader for syndicated loans in the Asia Pacific region

• #1 MLA in the Asia-Pac region ex Japan (Thomson Reuters LPC).

• No. 1 in Australia Bookrunner tables with USD4.06bn

Source: Bloomberg (including self led)

Source: Thomson Reuters LPC

1. In G3, HK, SING & AUD

Category Q3 2012 2011

Rank Volume % mkt

No. Issue

Rank

Australia 2 AUD9.8b 17.6 68 1

New Zealand 1 NZD2.8b 40.2 23 1

Asia Pacific ex-Japan 10 USD17.6b 2.5 110 9

China offshore (Dim Sum)

8 CNY4.1b 3 11 29

Corporate and frequent issuer bonds league table rankings

Loan syndications league table rankings

Retail Banking Asia Pacific & Commercial Banking Asia

117

10 10 11

13 13

4 4 5 6

7

Sep 10 Mar 11 Sep 11 Mar 12 Sep 12

Customer Deposits Customer lending

Retail Asia Pacific Customer Deposits & Lending (AUDb)

Commercial Banking Asia Income (AUDm)

Retail Banking Asia Pacific

• Customer deposits and lending grew 17% and 27%

year-on-year in Asia

• In 2012 on-boarded 27,574 new "Signature Priority

Banking" customers

• Improved product holding per customer to

1.8, primarily within the affluent segment

• Delivering on productivity agenda with full year

JAWS +1.3%

• Launched Mortgage loans in Hong Kong and

opened high-visibility, street-level flagship branch

in Kowloon

Commercial Banking Asia Pacific

• Focused on Hong Kong, Singapore & Taiwan

markets

• Active customers up 21% in 2012

• Income growth of 46% year-on-year driven

through priority products of Transaction Banking

and Markets

• Customer deposits and lending grew 53% and 73%

respectively in 20120

50

100

150

FY10 FY11 FY12

Transaction Banking Global Markets

Lending & Other

70

89

130

Asia Partnerships

118

Asian Partnerships NPAT Movement FY12 v FY11 (AUDm)

318

227

347 330 35

126

120 10 10

31 6

FY11 Reported

Sacombank Impairment

Accounting Adjustments

FY11 Adjusted

Earnings Growth

FY12 Adjusted

Gain on Sacombank

Sale

BoT Dilution Gain

SSI Impairment

Accounting Adjustments

FY12 Reported

Adjusted NPAT contribution by Partnership (AUDm)

0

20

40

60

80

100

120

AMMB SRCB Panin BoT Others

FY11 FY12

1. Earnings recognised by ANZ differ from published results of partnerships due to application of IFRS, Group accounting policies and acquisition adjustments.

2. Comprises Metrobank, Saigon Securities & Sacombank

11

Partnership Adjusted NPAT Mix FY12

28%

27%

23%

19%

3%

AMMB

SRCB

Panin

BoT

Others

2

2

GLOBAL FINANCE WORLD‟S BEST INTERNET BANK

WORLD‟S BEST INTERNET BANK

2012TAIWAN

SERVICE QUALITY AWARD

SERVICE QUALITY AWARDIN REGULAR BANKING

2012INDONESIA

BENCHMARK ADVISOR OF THE YEAR

BENCHMARK ADVISOR OF THE YEAR AWARD FOR ONE OF OUR

RETAIL BANKERS

2012HONG KONG

WEBAWARD

WEBAWARD FOR ANZ MOBILE BANKING

2011TAIWAN

SERVICE TO CARE AWARD

SERVICE TO CARE AWARD

2012INDONESIA

PRIME AWARDS FOR BANKING & FINANCE CORPORATIONS

BEST CONSUMER FINANCE BANK

2011HONG KONG

SERVICE EXCELLENCE AWARD

SERVICE EXCELLENCE AWARDS FOR CALL CENTRE

2012INDONESIA

CAPITAL MAGAZINE‟S MERITS OF ACHIEVEMENTS IN BANKING

AND FINANCE

PREMIUM BANKING SERVICES AWARD

2012HONG KONG

The impact we are achieving with our clients is recognised across the region

119

Institutional Retail

12TH CAPITAL OUTSTANDING ENTERPRISE AWARDS

BEST DEPOSITS SERVICE BANK

2012HONG KONG

CFO AWARDS

SYNDICATED BANK LOAN OF THE YEAR

2012FORTESCUE

PETER LEE ASSOCIATES LARGE CORPORATE AND INSTITUTIONAL RELATIONSHIP BANKING SURVEY

NO. 1 FOR RELATIONSHIP STRENGTH AMONGST LEAD DOMESTIC RELATIONSHIPS3

2012NEW ZEALAND

FX POLL

BEST FOR OVERALL FX SERVICES

2012HONG KONG & VIETNAM

EXCELLENCE AWARDS

BEST TRADE FINANCE BANK IN ASIA PACIFIC

2012ASIA PACIFIC


NO. 1 FOR DOMESTIC BANKING PENETRATION2

2012AUSTRALIA

EUROMONEY FOREIGN EXCHANGE SURVEY

BEST IN ASIAN CURRENCIES

2012ASIA


NO. 1 FOR MOST TRUSTED ADVISER2

2012AUSTRALIA

GREENWICH LARGE CORPORATE BANKING STUDY

TOP 5 CORPORATE BANK IN ASIA FOR BANKING

PENETRATION1

2012ASIA

1. Based on Greenwich Large Corporate Banking Study 2012.2. Rated No.1 equal in the Peter Lee Associates Large Corporate and Institutional Relationship Banking Australia Survey, 2012. Ranked against the top 4

competitors3. Based on the Peter Lee Associates Large Corporate and Institutional Relationship Banking Survey New Zealand 2012. Ranked against the top 3

competitors

AWARDS FOR EXCELLENCE

BEST TRADE BANK -AUSTRALASIA

2012AUSTRALASIA

http://www.google.com.sg/imgres?imgurl=http://www.euromoney.com/images/sites/1/FX2012.jpg&imgrefurl=http://www.euromoney.com/stub.aspx?stubid=92&usg=__YiH7l-qlzput-6WXuE1BADmuWPU=&h=694&w=1421&sz=76&hl=en&start=1&zoom=1&tbnid=KsS3pYKmWb1HeM:&tbnh=73&tbnw=150&ei=RoSrT8ydAYfMrQedidV6&prev=/search?q=Euromoney+FX+survey&hl=en&gbv=2&tbm=isch&itbs=1

BP Capital Markets

AUD500mSenior Bonds

2012

We are winning greater value added and substantial flow transactions

120

USD700mClub Deal Security

Agent/Account Bank

2012

PT Bayan Resource Tbk

Govt of Timor Leste

Trade Finance LCUSD 172m

Betano Power Plant

2012

USD57mReceivable Financing

2012

TP Huawei Tech Investment

USD150m, AUD50m 10 & 15 yr Bond

and Cross Currency Interest Rate Swap

2012

Envestra

Value-added transactions Substantial Flow transactions

Fiji Sugar

EUR40mStructured Trade Finance Facility

2012

BHP Billiton

AUD1bnSenior Bonds

2012

PT Bayan Resources

975,000 tonnes Thermal Coal

Extendable Hedge

2012

Transpower

NZD300m Senior Bond (fixed

& floating)

2012

Tencent Holdings

USD600mSenior Unsecured

Bonds

2012

2012

All Chinese Banks

52 tons(USD3.0bn)

in Physical Gold supplied byANZ Bullion

Boral

AUDEUR 500mFX trade deal

2011

USD300mDebut Bond

2012

Regal Hotels International Holdings

USD3bnBridge/Term Loan

Facility

Alibaba Group Holdings

2012

Sandfire Resources NL

AUD390mMining Project

Finance

2011

AUDUSD500mFX trade deal

Origin Energy

2011

Bunge China

Soybean hedging for US and Chinese

based entities

2012

AUD175mSenior Eurobond

and Cross Currency Swap

2012

Hyundai Capital Services

http://www.google.com.au/imgres?imgurl=http://4.bp.blogspot.com/-1eDtnSUn9cI/UFU9ICX4MGI/AAAAAAAAAWY/vD1Ot0I9Iyk/s1600/China--flag-pictures.gif&imgrefurl=http://flags-pictures.blogspot.com/2012/09/china-flag-pictures.html&usg=__82OKxZFe4iFcdDEPUo-3eMA088s=&h=360&w=600&sz=2&hl=en&start=3&zoom=1&tbnid=IUdUMHiNlV6ZpM:&tbnh=81&tbnw=135&ei=f0l_UJ_XCsuViAfd5IGAAg&prev=/search?q=chinese+flag&um=1&hl=en&gbv=2&tbm=isch&um=1&itbs=1

http://www.boral.com.au/

12FULL YEAR



25 October 2012



Change in Customer Satisfaction

The New Zealand simplification strategy is delivering

122

5%

1% 1%0% -1%

-2%

0%

2%

4%

6%

ANZ Peer 1 Peer 2 Peer 3 Peer 4

Mortgage Market Share


42%

43%

44%

45%

46%

1H11 2H11 1H12 2H12

• We have the most branches and the most ATM‟s. 7 new branches opened in growth areas since the simplification programme began

• Increasing the number of wealth, commercial and small business specialists

• NBNZ‟s #1 internet banking1 and ANZ‟s GoMoney give customers more access to services and products than any other bank

24%

30%

36%

Sep-11 Mar-12 Sep-12

Share of mortgage discharges

Share of new mortgages

Most convenient

Most efficient

• Productivity and simplification focus resulting in efficiency gains (lower cost to income ratio and tight management of headcount)

• One product suite enabling broader and more effective reach. Product variations reduced from 309 to 137

• Aligned processes across the bank enhancing automation and increasing sales conversion whilst reducing errors and duplication

Most connected

• Super regional advantage - the only bank in NZ to directly access 32 markets across the region

• Connecting businesses within the region via Trans-Tasman and China forums for Commercial customers

• Connecting businesses within New Zealand through hosted workshops, forums and events

Source: Terralink

Source: Nielsen Consumer Finance Monitor. Change measured from September 2011 to September 2012

1. Source: Nielson

A strong financial performance for New Zealand Businesses

123

Income growth continues to exceed cost growth

Underlying Profit

Simplification driving productivity gains

• Profit up 2% HOH (PBP +0.3%), 11% YOY (PBP up 4%)

• Operating expenses down 1% HOH through simplification, productivity gains and tight management of discretionary expenditure

• Operating income flat HOH with a decline in NIM offset by increased other operating income from volume growth, earthquake insurance recoveries and higher cards income

• Cost to income ratio declined YOY by 100bps (30bps HOH), with positive jaws of 3% (1% HOH)

Balance sheet growth

• Lending volumes increased by 3% HOH and YOY assisted by above-system growth in mortgages (particularly in Auckland)

• Customer deposits grew 3% HOH and 9% YOY, and the funding gap improved by $1.5b

Improvement in credit quality as we continue to support our customers

Reviewed and enhanced risk policies and practices to support sustainable business growth in challenging environment

Individual provision loss rate down 6bps HOH to 0.26%

• Sound credit processes led to a decline in delinquency rates and impaired assets are down 15% HOH

473

484

11

8 5

12

3 -

1H12

Underlying

profit

Net

interest

income

Other

operating

income

Operating

expenses

Provisions Income

Tax

2H12

Underlying

profit

NZDm

5%

3%

-2%

0%

FY11 FY12

Operating Income Operating Expense

Net Interest Margin – New Zealand Businesses

124

2.20%

2.30%

2.40%

2.50%

2.60%

2.70%

1H10 2H10 1H11 2H11 1H12 2H12

Net Interest Margin

• Net interest margin increased 11bps YOY

• HOH margin decline resulted from increased competition for deposits, higher wholesale funding costs

• Movement also impacted by balancing volume growth and pricing

266

259

3

2

9

4

3


Funding Costs

Deposits Assets Other 2H12

bps


Down 7 bps

252

2627

15

1

13

4


Funding Costs

Deposits Assets Other FY12

bps


Up 10 bps

45.7 48.0 49.6

0

20

40

60


NZDb

Retail CommAgri Small Business Banking

Good growth in Balance Sheet

Net Loans and Advances

Customer Deposits

125

• Increased 3% HOH with Retail and Small Business Banking growing at greater than system due to a focus on mortgages and the small business segment

• Retail lending up 2% HOH and 1% YOY

• Small Business lending up 7% HOH and 12% YOY

• CommAgri growth was moderated by ongoing Agride-leveraging, up 2% HOH and flat YOY

• Funding gap improved $1.5b, Loan to Deposit ratio improved 10 percentage points and deposits up 9% YOY

• Retail deposit growth was greater than system, up 6% HOH and 9% YOY

• Small Business Banking deposits increased 4% HOH and 13% YOY underpinning the total Commercial Segment (flat HOH, up 7% YOY)

85.5 85.4 87.9

0

20

40

60

80

100


NZDb

Retail CommAgri Small Business Banking

Up 3%

Up 9%

Credit quality improving

126

1,148

1,436 1,667

1,295 1,158

979

1.32%

1.65%

1.91%

1.51%1.36%

1.11%


Net Impaired Assets NIA as % Net Advances

349

165 98 119 101 89

-100

0

100

200

300

400

1H10 2H10 1H11 2H11 1H12 2H12

IP Charge CP Charge

NZDmNZDm

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

2007 2008 2009 2010 2011 2012

Mortgages

Commercial

Rural

Measure FY11 FY12 Movt

Net Impaired Assets (NZDm)

1,295 979 -24%

NIA/Net Advances 1.51% 1.11% -40bps

IP Loss Rate 0.38% 0.29% -9bps

Average CCR Risk Grade 5.16 4.96 -0.20

90 Day Delinquencies 0.36% 0.26% -10bps

Total provision charge

90+ Days Arrears

Net Impaired Assets

Key Credit Metrics

1. Spikes in 2012 Commercial 90 day delinquencies are primarily due to internal classifications rather than any deterioration in underlying credit quality.

1

29%

30%

31%

32%

Mortgages Household Deposits

FY11 FY12

0%

10%

20%

30%

40%

Sep-

10

Mar-

11

Sep-

11

Mar-

12

Sep-

12

ANZ Peer 1 Peer 2 Peer 3 Peer 4

0%

10%

20%

30%

40%

Sep-

10

Mar-

11

Sep-

11

Mar-

12

Sep-

12

Focus has been in switching and the Auckland market where ANZ is now #1

Market Share

Retail segment – increase focus on sales and customer service is delivering

127

Improved distribution

• More branches in growth catchments

• Capacity released through simplification reinvested to increase number of Home Loan Specialists and Mobile Mortgage Bankers

Targeted IT investment

• Focused IT development has improved the online banking experience (usage up 15%, satisfaction 99%) and available to another 1 million customers after the system conversion

Better processes

• Improved scorecards create productivity gains allowing staff to spend more time serving customers

• Simplified home loan process manifests in a faster response to customers

Improved market leverage

• More focused use of sponsorships and marketing effort

Simplification working

• Unprecedented growth in ANZ brand consideration with ANZ now #1 for ad awareness1

• ANZ is #1 in new mortgage registrations and Auckland mortgage market share2

Share of switching, Auckland Share of new mortgage registrations, Auckland

Source: Terralink, rolling 6 month average

Source: Share of Banks, Reserve Bank of New Zealand

1. Source: Nielson2. Source: Terralink

Underlying Profit

Strong Retail financial performance

128

131146

168176

1H11 2H11 1H12 2H12

NZDm

Underlying profit

• NPAT performance up 5% HOH, 24% YOY

Cost management focus

• Operating income flat HOH and up 5% YOY

• Operating expenses down 3% HOH, 1% YOY

Growth momentum through simplification and enhanced customer proposition

• 2% growth in lending volumes and 6% growth in deposits HOH

Continued improvement in credit quality

• Delinquencies have reduced to the lowest levels since the start of the GFC

• Volume growth has been in <90LVR mortgages with >90LVR continuing to decline (down 8bps HOH, 69bps YOY)

• Net impaired assets declined by 26% HOH and 42% YOY

Revenue growth, tight cost management and improved credit quality

1,101 1,151 1,211

683 677 673

148 78 62

FY10 FY11 FY12

Operating Income Operating Expenses Provisions

NZDm

129

CommAgri – simplification strategy focusing on leveraging scale and connectivity

Best Agribusiness Bank NZ

Leverage our scale

• Implemented a simplified and more efficientoperating model aligned to customer needs delivering greater customer satisfaction and consistency

• Investment in best practice Sales Framework to drive consistent sales disciplines, delivery to customer and performance monitoring

• Commercial risk management and lending practices embedded into Agri through Credit Pathways training, cashflow analysis, corporate Agri model and business of farming

Connectivity & sector focus

• Adding value via thought leadership including Farm Start-up Package, Future Farmers, sector collaborations, Fieldays, Privately Owned Business Barometer

Super regional differentiation

• Leveraging super-regional via Vietnam tour, China Business Forum, Sea Edge Symposium and Viewpoint on Asia and Trans-Tasman

• Customer service delivered in New Zealand resulted in customers‟ Australian banking being transferred from competitors to ANZ

• First ANZ India account opened for Commercial customer

“We couldn’t go past ANZ and National Bank as the institution providing the best value to rural

customers.

The focus on the agri-sector through its core products, as well as provision and facilitation of rural seminars and

meetings for agri-participants is a strong sign they are staying true to

their commitment to the agri-market for the long haul.”

Better connectivity with strong growth in cross sell into other ANZ businesses

80%

38%

21%

ANZ @ Work Interest Rates Trade

YOY Change in Cross-Sell Revenue

7 9 10

15 16 18

0

5

10

15

20

FY10 FY11 FY12

Customer Deposits Net Loans & Advances

Small Business Banking – simplification strategy driving strong growth in this important segment

130

Growing Market Share

Balance Sheet Growth

• Small Business Banking is an important segment in New Zealand, where 90% of businesses employ 5 or fewer staff (31% of employment) and constitute 44% of GDP

Optimise location of bankers

• Bankers moved into branches around network to provide 4% improvement in market coverage, driving lending growth and increased revenue performance

Optimise time spent with customers

• 52 simplification initiatives have allowed each banker to spend more time with customers

• Increased training and performance management has achieved significant sales uplift

Develop segment specialisation, including:

• Migrants - Super regional focus with 40+ migrant focused offices across NZ

• Agri - dedicated small business Agri bankers

• Start-ups - launched ANZ Farm Start-up Package including specialised workshops helping farmers to achieve their goals. Over a third of packages opened were new to bank customers

31%

33%34%

28%

30%

32%

34%

36%

0

2,000

4,000

6,000


Main Bank Share - SME (RHS)

Cumulative New to Bank customers (LHS)

NZDb

Source: Main Bank Share – TNS Business Finance MonitorNew to Bank – ANZ Small Business Banking Sales Tracker

Commercial Segment1 – improvement in asset quality delivering a better return

Underlying Profit

295 293305 307

1H11 2H11 1H12 2H12

Underlying Profit

• NPAT up 1% HOH, 4% YOY as the Agri portfolio continues to deleverage improving the quality of earnings and returns

Improvement in credit quality

• Net impaired loans as a percentage of net advances declined HOH by 30bps to 1.58%

• The Agri portfolio continues to improve following a period of strengthening commodity prices and de-leveraging

131

Net Impaired Assets

945

1,208 1,395

1,033 954 829

1.86%

2.36%2.71%

2.05%1.88%

1.58%


Net Impaired Assets NIA as % Net Advances

NZDm

NZDm

1 The Commercial Segment includes Commercial, Agri and Small Business Banking

2 CCR is a measure reflecting the ability to service and repay debt. Risk grades are from 0 (highest quality) to 10 (default)

Improvement in Agri risk profile

4% 4% 4%12% 9% 7%

12% 9% 7%

23%19% 18%

27%33%

33%

23% 26% 31%


Customer Credit Rating (CCR) Profile2

0-3

4

5

6

7-8

8- to 10

31.6

30.0

0.2

2.2

2.3

1.9

-

Sep 11 1H12 Lending

1H12 Deposits

2H12 Lending

2H12 Deposits

Sep 12

NZDb

New Zealand Geography – strong balance sheet and funding

Funding Gap improvement as deposit growth exceeds lending growth – FY12 v FY11

Strong Balance Sheet Growth

132

95.5 93.6 93.8 96.1

62.8 62.0 64.2 66.1

140%

150%

160%

40

60

80

100

120


Net Loans and Advances (incl. acceptances) (LHS)

Deposits (LHS)

Loan to Deposit Ratio (RHS)

Measure FY10 FY11 FY12

Customer Deposits 56.5% 59.1% 59.9%

Liquid Assets ($m) 15,200 16,600 17,100

Core Funding Ratio* 83.1% 84.0% 87.6%

Key Metrics

* The Reserve Bank of New Zealand minimum ratio will be 75% from 1 January 2013

A Strong and Stable Bank

• Funding gap improved by $1.6b YOY, Loan to Deposit Ratio down 6 percentage points to 145%

• Increased funding diversification with improved deposit mix and covered bond programme

• Core Funding Ratio has improved from 84% to 87.6%

NZDb

Short Term Strategic Priorities – management of brand merge

133

• Immediate focus – successfully convert to a single technology platform with minimal disruption to customers (systems merge end of October 2012)

• The largest single branch network in NZ, optimised to provide more coverage from less branches

• More specialists, enhancing customer experience

Most convenient

Most efficient

Most connected

• A single system generating operating efficiencies

• More efficient investment in both technology and marketing

• A single distinctive brand and one product suite offering customers the best of both brands

• Access scale delivered by a single technology platform and the footprint of a single brand. The new ANZ NZ can offer more, both locally and globally

• Most connected locally. Leverage combined footprint and specialists to provide more people, in more places to provide more service to more customers

• Most connected globally. More regional specialists. Only high street bank in NZ to directly access 32 markets across the region

• We announced that the ANZ and The National Bank (NBNZ) will come together and the NBNZ brand will be phased out over the next two years

• Our simplification strategy will continue and we are positioned well for future balance sheet growth and efficiency gains

15%

30%

45%


Consideration: Ipsos Brand & Ad Track, 6 month rollingUnprompted ad awareness

We made sure the market was ready for the new ANZ

NZ strategy established

New ANZ announced

Source: Consideration – Ipsos, Unprompted Ad Awareness - Nielson

29.8% 30.4%31.8%

32.7% 33.4%

14-Sep-12 21-Sep-12 28-Sep-12 05-Oct-12 12-Oct-12

Trends encouraging in mortgage approvals since new ANZ brand announcement

Source: RBNZ

Share of mortgage approvals

New ANZ announced

12FULL YEAR



25 October 2012

Divisional PerformanceGlobal Wealth and Private Banking Division

Global Wealth and Private Banking (GWPB)

135

• A new division that combines Global Wealth and Private Banking across Australia, New Zealand and the Asia Pacific

• Responsible for delivering investment, superannuation, insurance and advice solutions and private banking services to our customers

• The business is managed on a global basis to ensure an aligned approach and leverage our talent, systems and operations

Global Wealth and Private Banking

Direct Channels

Advice & Distribution

Global Pension & Investments

Global InsuranceGlobal Private

BankingE*TRADE

Global Women‟s Segment

Global Channels

Business Units

Australia Asia PacificNew Zealand

136

457 451

12

5

4

12

17

FY11 NetInterest

Other Income


FY12

$m

206

245

5

27 13 -

4

1H12 NetInterest

Other Income


2H12

$m

Global Wealth and Private Banking – Financial performance



Down 1%

Up 19%

Wealth – Business performance

137

• NPAT up 19% HOH but down 1% YOY

• Net funds management and insurance income up 4% HOH and 2% YOY

Better performance in insurance income and investment earnings, partially offset by lower funds management and advice income as adverse investor sentiment impacted volumes and margins

• 3% reduction in costs HOH as productivity benefits emerged with the CTI ratio down 350 bps HOH to 56.3%

• FUM up 1% HOH and 6% YOY with New Zealand strongly up 5% HOH and 15% YOY

• Annual in-force premiums up 6% HOH and 4% YOY with annual individual in-force premiums up 7% HOH and 11% YOY

Favourable claims experience, partially offset by higher lapse rates

49

5152

42

44

46

48

50

52


$b

1. Source: Plan for Life

100

110

120

130

140

150

(%)

Jun 09 Jun 10 Jun 11 Jun 12

8.0%

Funds under management

(end of period)

Individual Risk In-force1

(Index Jun 09 = 100)

ANZSystem

The material in this presentation is general background information about the Bank‟s activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate

This presentation may contain forward-looking statements including statements regarding our intent, belief or current expectations with respect to ANZ‟s business and operations, market conditions, results of operations and financial condition, capital adequacy, specific provisions and risk management practices. When used in this presentation, the words “estimate”, “project”, “intend”, “anticipate”, “believe”, “expect”, “should” and similar expressions, as they relate to ANZ and its management, are intended to identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Such statements constitute “forward-looking statements” for the purposes of the United States Private Securities Litigation Reform Act of 1995. ANZ does not undertake any obligation to publicly release the result of any revisions to these forward-looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events.

For further information visit

www.anz.com

or contact

Jill CraigGroup General Manager Investor Relations

ph: (613) 8654 7749 fax: (613) 8654 9977 e-mail: [email protected]

Date post:	22-Aug-2020
Category:	Documents
Upload:	others
View:	1 times
Download:	0 times

FULL YEAR RESULTS - ANZ · Results Presentation & Investor Discussion Pack. Index Full Year Result...

Documents